The Invesment Development Path and the Product Cycle - and Integrated Approach: Empirical Evidence from the new EU member States of CEE

In a globalized environment, where intense competitive pressures constitute the main features, Central and eastern Europe is emerging as a promising investment host region. Following the main lines of Vernon's Produce Life Cycle (PLC), Hirsch's International Trade and Investment Theory of the Firm (ITITF) and Dunning's Investment Development Path (IDP), a theoretical argumentation is synthesized and basic hypotheses are posed and empirically tested. Results demonstrate that these economies are going through the second stage of Dip and confirm a complementary relationship between FDI and Imports as well as the importance of specific location advantages advantages as key determinants of inwards FDI in the region.