nep-fdg New Economics Papers
on Financial Development and Growth
Issue of 2008‒03‒15
one paper chosen by
Iulia Igescu
Global Insight, GmbH

  1. Foreign Direct Investment and Structural Reforms: Evidence from Eastern Europe and Latin America By Campos, Nauro F.; Kinoshita, Yuko

  1. By: Campos, Nauro F. (Brunel University); Kinoshita, Yuko (International Monetary Fund)
    Abstract: This paper investigates the role of structural reforms – privatization, financial reform and trade liberalization – as determinants of FDI inflows based on newly constructed dataset on structural reforms for 19 Latin American and 25 Eastern European countries between 1989 and 2004. Our main finding is a strong empirical relationship from reforms to FDI, in particular, from financial liberalization and privatization. These results are robust to different measures of reforms, split samples, and potential endogeneity and omitted variables biases.
    Keywords: privatization, financial reform, trade liberalization, foreign direct investment, Latin America, transition economies
    JEL: H11 F21 O16
    Date: 2008–02

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