How Does Investment Promotion Affect FDI Inflows? Empirical Evidence from Asian Countries


Authors

  • Cao Thi Hong Vinh
  • Ha Phuong Thao
  • Doan Thi Thu Huong Foreign Trade University, Vietnam
DOI: https://doi.org/10.57110/vnujeb.v3i6.217

Keywords:

Investment promotion, IPAs, investment promotion budget, FDI inflows

Abstract

Despite the fact that investment promotion plays an important role for recipient countries to attract FDI, there has not been much research in the case of Asian countries – which are gradually becoming attractive destinations for FDI investors. To bridge this gap, by utilizing Dunning’s location advantage and UNCTAD’s host country determinant framework, using the data of 20 Asian countries from 2006-2021, and looking into investment promotion from the perspective of budget, our paper found that investment promotion budgets have a significantly positive impact on FDI in these Asian countries. In addition, while the FDI effect is significant in high investment promotion budget countries, it is insignificant in low budget countries. This implies the considerable role of the spent budget of countries for FDI attraction.

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Published

25-12-2023

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How to Cite

Vinh, C. T. H., Thao, H. P. ., & Huong, D. T. T. . (2023). How Does Investment Promotion Affect FDI Inflows? Empirical Evidence from Asian Countries. VNU University of Economics and Business, 3(6), 26. https://doi.org/10.57110/vnujeb.v3i6.217

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