Does institutional quality affect foreign direct investment? : a panel data analysis

Research output: Chapter in Book / Conference PaperChapter

Abstract

This study investigates the effects of the institutional quality along with socio-economic factors on foreign direct investment (FDI) of 156 countries using Ordinary Least Square (OLS) and Fixed Effect (FE) method. The findings of the study suggest that while corruption lowers FDI significantly, democracy, government stability, law and order, civil liberty and political rights have significant positive effects on FDI inflows. Results of the study also indicate that increased levels of educational attainment and openness in a trade regime lead to a higher level of FDI. Thus the policy prescription to attract higher FDI requires focussing on ensuring better institutional quality with a lower level of corruption along with raising the skill-base of the labour force in an outward looking external trade regime.
Original languageEnglish
Title of host publicationInequality, Poverty and Development in India: Focus on the North Eastern Region
EditorsUtpal Kumar De, Manoranjan Pal, Premananda Bharati
Place of PublicationSingapore
PublisherSpringer
Pages31-47
Number of pages17
ISBN (Electronic)9789811062742
ISBN (Print)9789811062735
DOIs
Publication statusPublished - 2017

Keywords

  • investments, foreign
  • corruption

Fingerprint

Dive into the research topics of 'Does institutional quality affect foreign direct investment? : a panel data analysis'. Together they form a unique fingerprint.

Cite this