LES DÉTERMINANTS DE L'INVESTISSEMENT DIRECT ÉTRANGER DANS LES PAYS D'ACCUEIL EN DÉVELOPPEMENT

Abstract

This paper analyzes the macroeconomic determinants of Foreign Direct Investment (FDI) in developing countries. Our analysis uses panel data on 81 developing countries during the period 1995­2005. The results indicate that the factors that drive FDI inflows are : human capital of the host economy, infrastructures endowments, degree of openness of the economy, economic freedom, political stability, natural resources availability, labor productivity and per capita GDP. All coefficients appear with the expected sign. Political stability and human capital variables have the largest impact on FDI inflows. Labor productivity and per capita GDP have the least impact. The results also indicate that countries in MENA (Middle East and North Africa) have on the average received less FDI than countries in other regions. There is a negative effect on FDI of being a MENA country. This suggests that may be an adverse regional bias against MENA. The MENA region is viewed as being inherently risky .