Determinants of foreign direct investment in Cambodia

Cuyvers, Ludo; Soeng, Reth; Plasmans, Joseph; Bulcke, Daniel Van Den

doi:10.1016/j.asieco.2011.02.002

Cited by 38 publications

(48 citation statements)

References 41 publications

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“…This theory justifies explicitly the rationales in which multinational companies pursue FDI, seeking to benefit lucrative opportunities existing in foreign countries. The profits earned offset losses from unfavorable market situations in home countries and enable them to compete with their industries (Cuyvers, Soeng, Plasmans, & Van Den Bulcke, 2011;Dunning & Lundan, 2008).…”

Section: Literature Reviewmentioning

confidence: 99%

“…We followed Bhasin and Gupta (2017b), and Cuyvers et al (2011) who underlined that foreign direct investment is strongly influenced by trade openness, market size, and real exchange rates. We collected annual data from the World Development Indicators database on foreign direct investment inflows, trade openness, market size and real exchange rates with 30 observation covering the period of 1987-2016.…”

Section: Model Specificationmentioning

confidence: 99%

“…Apart from the real exchange rate, domestic market size affects the foreign direct investment positively (Cuyvers et al, 2011;Liu, Wang, & Wei, 2001). However, the sign changes when the cost of transportation of goods or services to foreign markets exceeds the average cost of production within the markets, so that the market size is hypothesized having a negative impact on FDI inflows of receipt countries and it may strain the direct foreign effect.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Market size is defined in this study as the attractiveness of market with proxy by the GDP per capital, which means markets in host country whose consumers are wealthy magnetize the FDI. The trade openness influences the direct foreign investment in their positive or negative direction (Cuyvers et al, 2011;Gupta & Singh, 2016;Iamsiraroj, 2016;Liu et al, 2001;Seetanah & Rojid, 2011;Severiano, 2011). The country's openness to export, for example, attracts the export-oriented foreign direct investment, while an increase in tariffs and other barriers imposed on exporting trades by host country discourages inflows of FDI.…”

Section: Literature Reviewmentioning

confidence: 99%

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The Real Exchange Rate-Foreign Direct Investment Controversy in South Africa: An Application of ARDL Approach

Dahir¹,

Mahat²,

Bany‐Ariffin³

et al. 2017

IJEF

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This paper examines the relationship between real exchange rate and foreign direct investment. We apply autoregressive distributed lag (ARDL) bounds testing method to estimate short and long-run relationships between the series in South Africa over the period of 1987-2016. The results reveal long-run cointegration relationships among variables are confirmed, implying real exchange rate, domestic market size stimulate the foreign direct investment in the long run. Furthermore, there is significant Granger unidirectional causality foreign direct investment to real exchange rate in short and long run and from market size to trade openness in a short run. This finding further suggests that the exchange rate instability are likely to be substantially harmful to a positive effect of FDI and should be avoided in South Africa.

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Section: Literature Reviewmentioning

confidence: 99%

Section: Model Specificationmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

Section: Literature Reviewmentioning

confidence: 99%

See 2 more Smart Citations

The Real Exchange Rate-Foreign Direct Investment Controversy in South Africa: An Application of ARDL Approach

Dahir¹,

Mahat²,

Bany‐Ariffin³

et al. 2017

IJEF

View full text Add to dashboard Cite

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“…The GDP of a host economy is the most widely employed variable for market size in empirical studies of FDI [19]. Market size, usually indicated by GDP, GNP, GDP per capita, or GNP per capita, is significantly positively associated with FDI [19,20]. In addition, the economic growth rate is also utilised as an indicator for market size and is believed to be positively related with inward FDI [8].…”

Section: Market Sizementioning

confidence: 99%

Systematic Literature Review of Determinants of FDI

Liu¹

2017

dtssehs

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Abstract. Review of the literature on determinants of foreign direct investment (FDI) is important in identifying and characterising why MNCs' would like to choose FDI as their main method of penetrating new market. This paper aims to offer systematical review of all possible determinants of FDI, trying to help developing countries to better understand how to attract more inward FDI, and how to facilitate domestic companies to make investment in other countries.

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