Determinant factors of foreign direct investment: some empirical evidence

Galán, José Ignacio Pichardo; González‐Benito, Javier

doi:10.1108/eum0000000005795

Cited by 30 publications

(31 citation statements)

References 38 publications

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“…Cultural affinity is also another consideration. Studies on developing countries (Head and Sorensen, 2005) and Spanish multinationals (Galan and Gonzalez-Benito, 2001) identify a relationship between cultural elements and inflow of FDI. ROI is also identified as one microeconomic factor affecting the inflow of FDI.…”

Section: Othersmentioning

confidence: 99%

Demand Side Factors Affecting the Inflow of Foreign Direct Investment to African Countries: Does Capital Market Matter?

Hailu¹

2010

IJBM

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This paper aims at providing empirical analysis of the demand side determinants of the inflow of Foreign Direct Investment to African nations, with particular emphasis on stock market availability. Due to data heterogeneity, non-continuity and because the Hausman test favors it, cross section fixed effect Least Square Dummy Variable (LSDV) estimation technique is used. Natural resource, labor quality, trade openness, market accession and infrastructure condition are found to have positive and significant effect. Availability of stock market has the expected positive but insignificant effect. In search of possible explanation governments' expenditure and private domestic investment are added to the regression equation and are found to have positive effect, ruling out the possibility of crowding out effect. Stock markets in Africa are not structured in such a way that they can contribute to attract FDI and hence policy makers should restructure capital markets to get the most out of them. The bottom line is, policy makers of those countries have a lot of demand side instruments under their discretion to attract FDI inflow.

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Section: Othersmentioning

confidence: 99%

Demand Side Factors Affecting the Inflow of Foreign Direct Investment to African Countries: Does Capital Market Matter?

Hailu¹

2010

IJBM

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“…The most popular location is Hong Kong (China), followed by Singapore, Mexico, and China in that order. The breakdown by region is as follows: Latin and Central America (16 countries), Asia (13), Africa (8) and West Asia (Middle East) (4). There are also more highly ranked economies in South-East Asia and South America than in other regions of the developing world ( Table 3).…”

Section: Data and Empirical Analysismentioning

confidence: 98%

“…7 Knack and Keefer [19] found that the institutional environment for economies activity generally determines the ability of emerging economies to catch up to industrial country standards. 8 Recent work has been carried out by several researchers [8,12,15,16,18,20,21,25] among others. 9 The causality link between income and governance is far from being explained: (1) better governance exerts a powerful effect on per capita income; (2) higher incomes lead to improvements in governance; and (3) there are other factors to be considered.…”

Section: Data and Empirical Analysismentioning

confidence: 99%

“…Much recent studies of governance and corruption, based on simple empirical observations, using available worldwide indices, have shown that, on average, per capita income and the quality of governance are also strongly positively correlated across countries. 8 Simple deduction reasoning would imply that good governance is also a relevant factor explaining the most favoured locations by MNCs to set up foreign affiliates.…”

Section: The Importance Of Good Governancementioning

confidence: 99%

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Foreign direct investment in the health care sector and most-favoured locations in developing countries

Outreville

2006

Eur J Health Econ

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Given the growing importance of the health care sector and the significant development of trade in health services, foreign direct investment (FDI) in this sector has gathered momentum with the General Agreement on Trade in Services. Despite extensive case based research and publications in recent years on health care markets and the rise of private sectors, it is surprisingly difficult to find evidence on the relative importance of the largest multinational corporations (MNCs) operating in the health care sector. The objective of the paper is to identify some of the determinants of foreign investment of the largest MNCs operating in this industry. The list of the largest MNCs has been compiled using company websites and data is available for 41 developing economies for which at least two MNCs have an office (branch and/or affiliate). The results of this study have some important implications. They indicate that location-specific advantages of host countries, including good governance, do provide an explication of the internationalization of firms in some developing countries rather than others.

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“…China is not usually the first internationalization destination for these companies, they initially invested in markets with more cultural affinity or geographically closer (Galán and González-Benito, 2001). …”

Section: Spanish Company Profile In Chinamentioning

confidence: 99%

An overview of the management consulting firms of the Spanish company in China: company profile and success and failure factors

Niñerola

Planas

Hernández‐Lara

et al. 2016

Mult.J.Edu.Soc.Tec.Sci.

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This article explores the vision of Management Consulting Firms (MCF) specialized in internationalization processes of Spanish companies in China. The main objective is to shed light on a process full of uncertainty as is international expansion into emerging markets on the point of view of the advisors of that process. First, it is analyzed whether there is a Spanish company profile that is internationalized toward China in terms of sector of activity, size and experience in international business. And second, with their client's experiences, success and failure factors in the internationalization process are studied. To achieve those objectives in depth interviews were held with partners and managers of six Management Consulting Firms with Spanish clients in their portfolio. As a result it is concluded that the sectors where the Spanish company has invested are several, the size of the company is important to undertake an implementation process in China and its international experience as well. Eight key factors were found relevant to invest in China successfully. Five factors are related with their resources (humans and financials) and the other three are related with their strategy. The main reasons of failure are also discussed. The article provides an outside perspective on the reasons why an internationalization process is successful and other fails.

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Determinant factors of foreign direct investment: some empirical evidence

Cited by 30 publications

References 38 publications

Demand Side Factors Affecting the Inflow of Foreign Direct Investment to African Countries: Does Capital Market Matter?

Demand Side Factors Affecting the Inflow of Foreign Direct Investment to African Countries: Does Capital Market Matter?

Foreign direct investment in the health care sector and most-favoured locations in developing countries

An overview of the management consulting firms of the Spanish company in China: company profile and success and failure factors

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