Factors affecting foreign direct investment attraction- analyzing the case of top 15 countries receiving the most foreign direct investment in the world

Abstract

 Foreign direct investment (FDI) inflows have been shown to provide countries with many economic and social benefits. In recent time, lower barriers to FDI have led to higher competition between nations for this global capital flow. A large and growing body of literature has studied the deciding factors behind the location selection of FDI inflows. However, the experimental results are often conflicting, inconsistent, and therefore not highly representative. This research uses the OLS regression model to study the factors affecting FDI through data analysis of 15 countries receiving the most FDI in the world. The results indicate that market growth rate, infrastructure, market openess and exchange rate have significant impacts on attracting FDI capital. This finding can serve as the basis for countries in determining orientations and policies, improving their competitiveness in attracting FDI.