Determinants of foreign direct investment in fast-growing economies: evidence from the BRICS and MINT countries

By Simplice A. Asongu, Uduak S. Akpan, Salisu R. Isihak. Financial Innovation, 2018

111 citations recorded by the source corpus.

The flow of foreign direct investment (FDI) into a country can benefit both the investing entity and host government. This study employed panel analysis to examine the factors that determine the direction of FDI to the fast-growing BRICS (Brazil, Russia, India, China, and South Africa) and MINT (Mexico, Indonesia, Nigeria, and Turkey) countries. First, we used a pooled time-series cross sectional analysis of data from 2001 to 2011 to estimate and model the determinants of FDI for three samples: BRICS only, MINT only, and BRICS and MINT combined. Then, a fixed effects approach was employed to provide the model for BRICS and MINT combined. The results demonstrate that market size, infrastructure availability, and trade openness play the most significant roles in attracting FDI to BRICS and MINT, while the roles of availability of natural resources and institutional quality are insignificant. To sustain and promote FDI inflow, the governments of BRICS and MINT must ensure that their countries remain attractive for investment by offering a level playing field for investors and political stability. BRICS and MINT governments also need to invest more in their human capital to ensure that their economies can absorb substantial skills and technology spillovers from FDI and promote sustainable long-term economic growth. This study is significant because it contributes to the literature on determinants of FDI by extending the scope of previous studies that often focused on BRICS only.

Subfields: Economics and Econometrics, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/0be27bcbdc3af1e24d53340561323da57bf6604c

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Citations in the corpus

Relationship Among Economic Growth, Energy Consumption, CO2 Emission, and Urbanization: Evidence From MINT Countries (2020, background): “For instance, Indonesia and China are closely located, Turkey is at the border of the European Union, Mexico is the next neighbor to America, and Nigeria is to serve as the economic rally point for Africa (Asongu et al., 2018). Moreover, of the four countries that constitute the MINT countries, only”
The role of information and communication technology in encountering environmental degradation: Proposing an SDG framework for the BRICS countries (2021, background): “In South Africa, Salahuddin and Gow (2016) documented that the utilization of the internet increases the economic development process.”