Trade policy space and foreign direct investment inflows
Purpose: This study aims to use a quantitative measure of trade policy space to investigate empirically whether trade policy space influences foreign direct investment (FDI) flows to countries. Design/methodology/approach: The empirical analysis covers an unbalanced panel data set of 158 countries, over the period 1995–2015 and uses the two-step system generalized methods of moments approach. Findings: The results suggest that the impact of trade policy space on FDI inflows is positive and increases as countries enjoy greater trade policy space. Furthermore, advanced economies tend to experience a higher positive impact of trade policy space on FDI inflows than less advanced economies. Research limitations/implications: These findings highlight the relevance of trade policy space for countries’ FDI inflows. Practical implications: The analysis shows that non-trade related constraints to trade policy could reduce trade policy space and adversely influence FDI inflows, which are critical for countries’ economic growth and development. Originality/value: To the best of the knowledge, this topic has not been addressed in the literature.
Year of publication: |
2020
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Authors: | Gnangnon, Sena Kimm |
Published in: |
Review of International Business and Strategy. - Emerald, ISSN 2059-6014, ZDB-ID 2854169-8. - Vol. 30.2020, 3 (03.07.), p. 323-343
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Publisher: |
Emerald |
Saved in:
Online Resource
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