Faculty Publications

Exploring The Relationship Between Institutional Factors And FDI Attractiveness: A Meta-Analytic Review

Document Type

Article

Keywords

FDI attractiveness, Foreign direct investment, Institutional environment, Institutions, Location choice, Meta-analysis

Journal/Book/Conference Title

International Business Review

Volume

27

Issue

1

First Page

139

Last Page

148

Abstract

This meta-analysis attempts to synthesize and review decades of research on the relationship between institutional factors and host country foreign direct investment (FDI) attractiveness. Using prior tests derived from 97 primary studies, we find support for prior theoretical predictions that institutional factors such as political stability, democracy, and rule of law attract FDI, while others such as corruption, tax rates and cultural distance deter it. Further evidence suggests a need for exploration of moderating factors that may influence previous key findings. Specifically, environmental effects such as level of development, region of destination, and competitive industry environment have varying influence on the strength and significance of the relationship. We also explore a number of methodological and economic moderating variables, providing additional interesting insights into previous empirical analyses. We conclude with suggestions for future research that stress a call for further contextualization of the relationship.

Department

Department of Management

Original Publication Date

2-1-2018

DOI of published version

10.1016/j.ibusrev.2017.05.012

Repository

UNI ScholarWorks, Rod Library, University of Northern Iowa

Language

en

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