What determines FDI inflow to MENA countries? Empirical study on Gulf countries: Sectoral level analysis

Elheddad, Mohamed

doi:10.1016/j.ribaf.2017.07.101

Cited by 37 publications

(38 citation statements)

References 22 publications

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“…The test of endogeneity shows that the null hypothesis of specified endogenous variable can be treated as exogenous is rejected at p < 0.05. Many prior studies have employed the lagged value of supposed endogenous covariate as an appropriate instrument [13,80]. Table 8 shows that our main results in benchmark estimation (Model 5 in Table 4) remain consistent across all three estimators.…”

Section: Robustness Testssupporting

confidence: 56%

“…PCSEs estimator suits best to small panels and accounts for finite sample bias while producing panel-corrected standard errors that allow heteroskedasticity and correlation within panels [69]. Many empirical studies, such as [13,[70][71][72], have employed PCSEs estimator and highlighted that for data sets with features as in this research, PCSEs offers a better fit and rather robust estimates than other alternative models. Nevertheless, to test the robustness of regression results to changes in the underlying econometric model, we augment PCSE estimations with Parks […”

Section: Empirical Model Specificationmentioning

confidence: 96%

“…Undeniably, natural resources are critical components of the economy, especially in developing countries where the resource extractive sector constitutes a considerable portion of the gross domestic product (GDP) [6]. Nevertheless, some studies on FDI have found that resource-rich countries attract a lower volume of inward FDI than resource-scarce countries [11][12][13]. Considering that CIS countries are endowed with vast natural resource reserves [14], a substantial volume of FDI to these countries is mainly concentrated on resource extraction, signposting the importance of resources in attracting FDI [15].…”

Section: Introductionmentioning

confidence: 99%

“…Given the prior literature, it is conspicuous that natural resources and economic freedom have grown in importance in studying the determinants of FDI inflows, and have particular relevance to the empirical studies of developing nations [13,21,27]. Nonetheless, thus far, econometric research linking natural resources, economic freedom, and physical geographic location to FDI is limited, particularly in transition economies.…”

Section: Introductionmentioning

confidence: 99%

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Foreign Direct Investment, Natural Resources, Economic Freedom, and Sea-Access: Evidence from the Commonwealth of Independent States

Kasimov

Karimov

et al. 2020

Sustainability

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This study examines the importance of natural resources, economic freedom, and sea-access in attracting foreign direct investment (FDI) inflows to the Commonwealth of Independent States (CIS), using panel data from 1998 to 2017. The Prais-Winsten regression with panel-corrected standard errors (PCSEs) is employed for all estimations. Feasible Generalized Least Squares (FGLS), Random Effects with Driscoll-Kraay standard errors (RE (D-K)), and Random Effects of Generalized Least Squares (RE (GLS)) estimators are used to test the sensitivity of PCSEs’ estimates to changes in the underlying empirical model, whereas Instrumental Variables with Two Stage Least Squares (IV (2SLS)), Limited Information Maximum Likelihood (LIML), and Baltagi’s Two-Stage Least-Squares Random-Effects (IV (EC2SLS)) estimators are used to address potential endogeneity concerns. The estimates confirm that natural resources, economic freedom, and sea-access are robust and decisive factors affecting FDI location decisions of foreign investors in CIS. More precisely, the results suggest that increased revealed comparative advantage in petroleum, higher economic freedom characterized by the increased government size and open markets, and territorial coastlines have a statistically significant and positive effect on FDI inflows to CIS transition economies. We also find that direct access to the Black Sea and the Caspian Sea provides a significant geographic competitive advantage to Azerbaijan, Kazakhstan, Georgia, Russia, Turkmenistan, and Ukraine in attracting FDI inflows over the other CIS member-states.

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Section: Robustness Testssupporting

confidence: 56%

Section: Empirical Model Specificationmentioning

confidence: 96%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Foreign Direct Investment, Natural Resources, Economic Freedom, and Sea-Access: Evidence from the Commonwealth of Independent States

Kasimov

Karimov

et al. 2020

Sustainability

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show abstract

“…The literatures found market size and growth (Bevan & Estrin, 2004); availability of natural resources (e.g. Elheddad, 2017); skilled and qualified human capital (e.g. Kar 2013; Ndeffo, 2010; Lewin et al, 2009); quality of infrastructure (Cheng & Kwan, 1999); and government policies (Cleeve, 2008); governance quality (Abdioglu et al, 2013); and political stability (Cleeve, 2012;Musibah, 2015).…”

Section: Introductionmentioning

confidence: 99%

Role of Sanctions and Macroeconomic Determinants on FDI Inflow: A Case Study

M¹,

Lc²

2020

Preprint

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In this paper, we investigate the role of sanctions in the relationship between macroeconomic determinants and foreign direct investment inflows. We also investigate the moderating role of sanctions in FDI inflows into Iran. The empirical results reveal that macro determinants such as infrastructure, exchange rate, inflation rate, investment return, and governance have a long-run impact on FDI inflows in Iran. Our findings also show that GDP growth rate and trade openness have no significant effect on FDI. Our results indicate that sanctions do not have a significant moderating role in the relationship between macroeconomic factors and foreign direct investment. Surprisingly, international sanctions have a positive relationship with FDI inflows in Iran. Furthermore, sanction has a positive impact on the inflation rate and exchange rate in Iran. Finally, our findings show that sanctions have had a significant impact on Iran's economic growth in recent years due to increasing the severity level of sanctions.

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Food prices and poverty in Africa

Iheonu,

Oladipupo

2023

Sustainable Development

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This study investigated the effect of food prices on poverty in 37 sub‐Saharan African economies between 2001 and 2020. The study employed Prais‐Winsten regression, variations of the Fixed Effects model to account for conventional biases in econometric modeling, and the Method of Moment Quantile Regression with Fixed Effects to account for existing poverty levels. The findings revealed that a higher proportion of Africans will fall into poverty due to the increase in food prices. This result is consistent with the presence of endogeneity, cross‐sectional dependence, and unobservable heterogeneity. The study also reveals that the increase in food prices has a greater effect in sub‐Saharan African countries with lower levels of poverty as compared to those with high poverty levels, showing that rising food prices disproportionately hurt countries with low poverty levels, pushing more Africans below the poverty line in those countries. The study recommends the need for the implementation of supply‐side agricultural policies that enhance productivity in the sector, thereby boosting aggregate agricultural supply and precipitating a decline in food prices.

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What determines FDI inflow to MENA countries? Empirical study on Gulf countries: Sectoral level analysis

Cited by 37 publications

References 22 publications

Foreign Direct Investment, Natural Resources, Economic Freedom, and Sea-Access: Evidence from the Commonwealth of Independent States

Foreign Direct Investment, Natural Resources, Economic Freedom, and Sea-Access: Evidence from the Commonwealth of Independent States

Role of Sanctions and Macroeconomic Determinants on FDI Inflow: A Case Study

Food prices and poverty in Africa

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