Sustainable development requires implementation of relevant green transformation of countries by providing green policies and extending green technologies and renewable energies. Withal, it requires attracting additional knowledge, human, financial, and natural resources. In this case, countries with higher investment attractiveness have a higher capability to attract additional knowledge and resources to implement mechanisms and policies to achieve sustainable development goals. The effectiveness of public governance is a basic condition for the successful modernization of the economy to develop a positive business climate and attract investment. The paper aims at analysing the impact of institutions’ quality on a country’s investment attractiveness. The objects of research are Ukraine and the EU countries. The study applies correlation and regression analysis to achieve the purpose of the research. The findings show that institutions’ quality has a positive and statistically significant effect on a country’s investment attractiveness in the EU countries. However, in political stability, freedom and quality of governance positively influence a country’s investment attractiveness. Improving political stability by one point promotes the integrated index of a country’s investment attractiveness for the EU country by 0.086 and for Ukraine by 0.016. The impact of the rule of law on a country’s investment attractiveness is not statistically significant. This means that Ukraine has not formed an appropriate and affordable legislation base for attracting investors to the country. Thus, the Ukrainian government should pay attention to legislation for the regulation of social and economic development and energy and resource use.
Authors: Bogdan A. Moskalenko, ORCID: https://orcid.org/0000-0003-3972-1705 Joint stock company “ProCredit Bank”, Business Client Advisor, Kyiv, Ukraine Pavlin Mitev, ORCID: https://orcid.org/0000-0001-5798-4192 Joint stock company “Raiffeisenbank EAD”, Credit Risk Policy Manager, Bulgaria Pages: 95-101 Language: English DOI: https://doi.org/10.21272/fmir.4(3).95-101.2020 Download: Views: Downloads: 26 7 Abstract The article summarizes the arguments within the scientific challenge on improving approaches to country investment potential evaluation. The main objective of the research is to systematize the existing statistical methods of decomposing macroeconomic time series into growth (trend) and cyclical components. Systematization of theoretical and methodological materials on solving the problem of decomposing the trend and cyclical components of time data series showed that the use of filtering series of economic dynamics based on the Hodrick-Prescott filter allows identifying long-term growth trends or recessions. The relevance of solving this problem is that the country investment potential evaluation is often based on investigating the impact of foreign direct investment`s determinants in a domestic economy while ignoring cyclical macroeconomic processes within and outside the country, on which those determinants often have not responded yet or reacted late. The methodical tools of the research are carried out in the following logical sequence: systematization of existing statistical methods for trend component decomposing; analysis of data that will be used in the decomposition process and in further country investment potential evaluation; application of the Hodrick-Prescott filter and trend component decomposing in foreign direct investment net inflows dynamics into the economy of Ukraine. The Research methods combine in following dimensions: comparative analysis, regression analysis and univariate methodology of time series decomposing. The period from 1999 to 2019 was chosen as the research period. The object of the research is foreign direct investment net inflows into the economy of Ukraine, as they are the determining element within the country investment potential evaluation process. The article presents the results of empirical analysis, which showed that the decomposing a trend and cyclical components of foreign direct investment inflows can improve the quality of investment potential evaluation, considering the impact of current economic cycle phase. The results of the research can be useful for a more accurate investment potential evaluation on the macroeconomic level and forecasting foreign direct investment inflows for the following time periods. Keywords: business cycle synchronization; country investment potential; foreign direct investment; Hodrick-Prescott filter; national economy.
The article summarizes the arguments within the scientific challenge on improving approaches to estimate the environmental impact of FDI inflow on the economy. The main objective of the research is to systematize the existing statistical approaches to analyze whether and how the macroeconomic determinants could impact the environment in terms of greenhouse gas emissions. Systematization of theoretical and methodological materials on solving the problem of choice of applying more or less stringent environmental regulations with addition to more efficient industrial technologies which are supposed to have a positive impact on the environment. The relevance of solving this problem is that inceptive of FDI inflow could provide the economy with resources that reduce pollution, create better conditions for workers and local citizens. On the other hand, FDI is not interested in investing in economies with strict environmental legislation. The methodical tools of the research are carried out in the following logical sequence: the systematization of existing statistical methods panel data analysis; analysis of data that will be used in the estimation model and in further country environmental policymaking process; application of fixed and random effects models in estimation of the environmental impact of FDI on analyzed data. The research methods combine in the following dimensions: comparative analysis, regression analysis. The period from 1999 to 2018 was chosen as the research period. The objects of the research are foreign direct investment net inflows into the Baltic-Black Sea region countries` economies and their impact on its environment. The article presents the results of empirical analysis, which showed that FDI inflow has an impact on the environment, but it is severely limited by other more significant determinants. The pollution haven hypothesis in the Baltic-Black Sea trans-national region countries policy in attraction FDI has not been proved considering more strict high-standard environmental legislation in EU countries alongside with increase in GHG emission per capita. The results of the research can be useful within government policy-making processes considering the aim to incentivize FDI inflow. Keywords: country investment potential, environment, foreign direct investment, greenhouse gas emission, national economy.
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