Determinants of Foreign Direct Investment Inflows in Central and Eastern European Countries

Abstract

In the paper the author tries to analyse the value of foreign direct investments inflow into certain Central and Eastern Europe countries and to assess determinants which cause these countries to attract large value of the foreign direct investments. Twenty countries of the aforementioned region were analysed. Ten of them belong to the European Union including three belonging to the Eurozone. Additionally, the paper contains presentation of the most significant determinants of the foreign direct investments based on investors’ motives. In order to achieve the aforementioned goal, the author reviewed the literature on the subject paying special attention to the issues in question, and she presented the results of the survey focused on the FDI determinants in the economies which are the subject of this paper. The paper also contains results of two surveys conducted by the author in 2006 and 2012 regarding motives of the entrepreneurs who make foreign direct investments in the territory of the EU countries. Review of the theory, analysis of general empirical observations and own surveys of the author prove that the size of a market, the possibility to maximize profits and discounts and privileges for investors are the most substantial internal and external factors which encourage entrepreneurs to invest on foreign markets. Moreover, membership in the European Union and/or the Eurozone, as well as the warranty of macroeconomic stability of a country also pose a substantial advantage when an investor chooses the location for an investment.

Public health and national security proxies: Case of European countries

“…Ben Amor (2023) defines GDP growth and unemployment rate reduction as the key determinants of the state's economic well-being. Singh (2022) notes that the economic growth is based on attracting investment resources to the country. Innovative activity, technological development and improvement of organizational and business processes with the transition to digital technologies are also identified by some researchers as determinants ensuring the economic security of the state (Arivazhagan et al, 2022;Dias et al, 2023;Khalifa et al, 2023;Kliuchnikava, 2022;Houfaf Khoufaf, & Nouiri, 2023;Mayimele, Demana, & Keele, 2023;AL-Hashimi, AL-Toobi, Ahmed, 2023).…”

The role of human factor and HRM practices in MNCs’ performance in Eastern and Western Europe – a comparative analysis of the research findings

“…Prior to the changes that took place at the end of the 1980s, it had been even the state that controlled HRM activities in most East European countries (Listwan et al, 2009). Since the end of the Socialist Block the financial and economic growth have accelerated but on average it's still lower with comparison to Western Europe (Stawicka, 2014;Skare & Porada-Rochoń, 2019). And the social, organizational and managerial changes, although visible all around, are not free of the encounters with the past authoritarian/patriarchal managerial models.…”

Analysis of determinants of the inflow of foreign direct investment to Poland. Part I – theoretical considerations

“…The review of research studies shows that, between 1990 and 2017, economic determinants played a key role in the decision-making process of FDI (Karaszewski, 2001;Lizińska, 2012;Stawicka, 2014;Gorynia et al 2015;Shukurov, 2016;Cieślik, 2017b;Jaworek and Karaszewski 2018). This is also confi rmed by the research fi ndings relating to the motives for choosing Poland as a place to locate capital in the form of direct investment.…”