Resource title

FDI, Regulations and Growth

Resource image

image for OpenScout resource :: FDI, Regulations and Growth

Resource description

The paper explores the linkage between income growth rates and foreign direct investment (FDI) inflows. So far the evidence is rather mixed, as no robust relationship between FDI and income growth has been established. We argue that countries need a sound business environment in the form of good government regulations to be able to benefit from FDI. Using a comprehensive data set for regulations, we test this hypothesis and find evidence that excessive regulations restrict growth through FDI only in the most regulated economies. This result holds true for different specifications of the econometric model, including instrumental variable regressions.

Resource author

Matthias Busse, José Luis Groizard Cardosa

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/19370

Resource license

Adapt according to the presented license agreement and reference the original author.