Determinants of Foreign Direct Investment in Transition Economies: With particular Reference to Macedonia's Performance

Arbeitspapier

Using a panel dataset of bilateral flows of foreign direct investment (FDI), we study the determinants of FDI in transition economies, with particular reference to Macedonia?s performance. As many transition countries, Macedonia has a low FDI potential and performance. The empirical work confirms the expectation of the positive feedback effect of past FDI onto current FDI. We do not have enough large dataset to say that all other variables, such as the GDP of the host and source country, unit labour cost, trade, inflation, legal environment, distance, and dummy variables capturing the language, common border and colonizing effect, do not have an effect on FDI stocks. Our suggestion is that all the econometric findings on the determinants of FDI in transition economies using small dataset and static models should be accepted only with caution.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: FIW Working Paper ; No. 19

Classification and Topics

• Classification: Wirtschaft
• Subject: Foreign Direct Investments ; Transition Countries ; Gravity Model ; Panel Data Estimation

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Zulfiu, Merita
• Event: Veröffentlichung
• (who): FIW - Research Centre International Economics
• (where): Vienna
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/121020
• Last update: 10.03.2025, 11:42 AM CET