Institutional Quality in Central and East European Countries and Its Impact on FDI Inflow

Dorożyński, Tomasz; Dobrowolska, Bogusława; Kuna‐Marszałek, Anetta

doi:10.15678/eber.2020.080105

Cited by 13 publications

(17 citation statements)

References 44 publications

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“…Financial reform, effective financial intermediation, the adoption and distribution of financial technology, the transformation of financial aid, the efficient mobilization of economic resources, and the expansion of financial markets are all examples of policies that can be implemented. Another factor contributing to foreign investment is effective governmental practices (Aibai et al, 2019;Huynh and Hoang, 2019;Dorozynski et al, 2020;Cong Minh Huynh, 2022). The study of Narayanan et al (2020), for example, explored the relationship of FDI and good governance for the ASEAN countries, as a sample, for the period from 2002 to 2015 using the PMG estimation method.…”

Section: Introductionmentioning

confidence: 99%

Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL

Jinru

Qamruzzaman

Hangyu

et al. 2022

Front. Environ. Sci.

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Domestic capital adequacy and sustainable economic growth are heavily reliant on technological advancement, managerial know-how, and money supply in the economy. In this context, FDI has emerged and is placed at an apex position due to its unprecedented impact on achieving sustainability across the world. The motivation of this study is to scale the effects of good governance, financial inclusion, and environmental quality on inflows of FDI in BRI nations for the period from 1990 to 2020. Several panel econometrical tools have been applied, for example, CDS, CADF, CIPS, CS-ARDL, and NARDL, to investigate the association and explanatory variables elasticity on inflows of FDI in BRI nations. CDS results revealed that research units share common dynamism and second-generation panel unit root test-documented variables are stationary after the first difference. The results of the panel co-integration with an error-correction term confirmed the empirical equation’s long-run association. According to the CS-ARDL assessment, positive and statistically significant impacts have been documented, from financial inclusion, good governance, and environmental quality to FDI inflows. Study findings suggest that governmental effectiveness, easy access to financial services and benefits, and a less-regulated environmental concern economy motivate capital transfer decisions. The asymmetric assessment documented a long-run asymmetric association between FI, GG, EQ, and FDI. Referring to asymmetric shock elasticity, the study disclosed a positive and statistically significant relation to FDI inflows, especially in the long run. The directional causality test documented bidirectional causality running between FI, EQ, GG, and FDI [FI←→FDI; GG←→FDI; and EQ←→FDI] in the short-run.

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Section: Introductionmentioning

confidence: 99%

Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL

Jinru

Qamruzzaman

Hangyu

et al. 2022

Front. Environ. Sci.

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“…Institutional and international business theories affirm that the institutional environment influences the international firm's activities in home and host environments (Rask & Servais, 2015) and the quality of institutions is essential for the firms' internationalisation and growth (Cheng & Yu, 2012, Dorozynski, Dobrowolska, & Kuna-Marszalek, 2020. The institutional environment also affects entrepreneurship (Elert & Henrekson, 2017;Bag & Omrane, 2021), however, for the different extent in different countries considering their level of development (Khaki & Akin, 2020), governance quality and informal relations spread (Digdowiseiso & Sugiyanto, 2021;Mishchuk et al, 2020), peculiarities of labor supply (Bilan et al, 2020).…”

Section: Institutions and Institutional Pressuresmentioning

confidence: 99%

Exploring the institutional pressures that affect international new ventures

Butkeviciene¹,

Sekliuckienė²

2022

EBER

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This article aims to identify the link between institutional pressures and strategic responses of international new ventures (INVs). Research Design & Methods: This article reviews and theoretically synthesises extensive literature from the institutional and international entrepreneurship theories. The discussion leads to the formulation of four research propositions. Findings: The relationship between institutions and entrepreneurial firms' activities remains lacking in relevant research. Thus, given the constraints of INVs, the suggested propositions assist in identifying the nature of the institutional pressures exerted on entrepreneurial firms. Through the breakdown of the institutional pressure determinants, three groups of pressures are discussed. The text suggests that coercive, normative, and mimetic pressures evoke more active strategic responses of INVs, as internationally oriented, entrepreneurial, technology-driven firms. The institutions and INVs strategic responses may have a bidirectional relationship. At the same time, legitimacy constraints to INVs may involve more than one scenario of how the INVs behave, which converts to a set of various responses to institutions, which lead to embedded relationships with institutions. Implications & Recommendations:The formulated research propositions illuminate numerous practical implications, leading to future research agendas. Researchers studying international entrepreneurship and entrepreneurs will benefit from reflecting on the proposed framework's dimensions and interactions. International new ventures need to legitimise themselves in various institutional environments. However, they can be active partners in forming their institutional context through progressive involvement. Another input is aimed at policymakers looking to shape the institutional environment. Contribution & Value Added:The theoretical contribution of this article lies in its introduction of a set of research propositions that explain the relationship between the institutional pressures and strategic responses of INVs and set a future research directions. The value-added consists in exploring institutional pressures that lead to more active responses of INVs because of entrepreneurial firms' specifics and emphasising the role of INVS in the building of institutions.

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“…the Visegrad countries), but also to a growing extent, in Romania (Pavlínek et al, 2017). This position was acquired through foreign direct investment (FDI), and the region, especially the Visegrad country group, remains among the most attractive locations for investment (Dorożyński, Dobrowolska, & Kuna-Marszałek, 2020;Makieła, Wojciechowski & Wach, 2021). At the same time, this attractiveness has contributed to the evolution of these countries, dependency on the Western European core (Nölke & Vliegenthart, 2009) and has enhanced the vulnerability of these economies in times of crisis.…”

Section: Literature Reviewmentioning

confidence: 99%

Covid-19 and transformational megatrends in the European automotive industry: Evidence from business decisions with a Central and Eastern European focus

Pelle¹,

Tabajdi²

2021

EBER

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The objective of the article is to reveal the effects of the Covid-19 pandemic on the businesses in the European automotive sector, with a special focus on Central and Eastern Europe. The further objective is to identify how these effects relate to the ongoing transformational megatrends in the sector (digitalisation, electrification). Research Design & Methods:We have collected a large (>700 items) sample of relevant business decisions in the European automotive sector over four years (2017)(2018)(2019)(2020)(2021), including those taken especially due to the Covid-19 pandemic. In our research, we transformed our qualitative inputs into a quantitatively analysable database through coding. Then, we applied descriptive statistical analysis on the retrieved data combined with qualitative analysis of the contents behind these data. Findings: Based on our sample, our primary finding is that the Covid-19 pandemic does trigger the already existing trends of digitalisation and electrification in the European automotive sector. Very similar effects characterise the relatively less developed but deeply integrated Central and Eastern European periphery, although to a lesser extent. Obviously, the Covid-19 pandemic has induced numerous temporary business decisions, mainly plant closures. Layoffs occurred as well but these were not prevalent. Then, the second wave of the pandemic in early 2021 brought about the global shortage of semiconductor chips, which substantially affected the sector in Europe. Implications & Recommendations:The longer lasting impact of the short-term pandemic-related European automotive business decisions is yet to be explored. Nevertheless, the global shortage of semiconductor chips is already showing signs of influencing the industry over a longer time scale, in Europe as well. Forward-looking, future-oriented, and brave responses to the pandemic can well be the keys for businesses to successfully overcome the negative effects of the Covid-19 pandemic. Contribution & Value Added: Our sample of more than 700 items and a four-year-long timespan is in itself a unique collection of business decisions in the European automotive sector. In addition, by processing the inputs through coding, our sample becomes a treasury of potential information. In this article, we conduct an exploration along the events to which the decisions can be related, and along the decision types. We also look at the involvement of Central and Eastern Europe. Obviously, our ongoing primary research was ready to be extended to the firm level analysis of the effects of the Covid-19 pandemic, immediately upon its outburst.

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Institutional Quality in Central and East European Countries and Its Impact on FDI Inflow

Cited by 13 publications

References 44 publications

Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL

Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL

Exploring the institutional pressures that affect international new ventures

Covid-19 and transformational megatrends in the European automotive industry: Evidence from business decisions with a Central and Eastern European focus

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