Factors Affecting FDI Flows into in Developing Countries

Subject Areas : Financial Economics

Nazi Mohammadzadeh Asl ¹ , Azarakhsh Sabri Baghaee ² , Mahmoud Reza Modir rosta ³

1 - Assistant Professor, IAU, Central Tehran Branch
2 - IAU, North Tehran Branch
3 - M.Sc Student

Received: 2015-06-13 Accepted : 2015-06-13 Published : 2008-12-21

Keywords: FDI, needs to attract foreign investment, developing countries,

Abstract :

This article reviews the importance of foreign direct investment and examines factors affecting its flow into developing countries A Panel Data technique is employed to estimate the empirical models to explain the relevant factors affecting the FDI into developing countries. Time span covers 1994-7442 for 77 developing countries. The results indicate that factors such as interest rate, domestic investment, size of government growth in foreign exchange earnings and socieconomic condition of the countries are the most important variables affecting the FDI into developing countries.