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Article
Foreign Direct Investment in Central and Eastern European Countries: A Dynamic Panel Analysis
Journal of Comparative Economics (2004)
  • Kai Carstensen
  • Farid Toubal
Abstract

This paper uses dynamic panel data methods to examine the determinants of foreign direct investment (FDI) into Central and Eastern European countries (CEECs). Our empirical model shows that the traditional determinants, such as market potential, low relative unit labor costs, a skilled workforce and relative endowments, have significant and plausible effects. In addition, transitionspecific factors, such as the level and method of privatization and the country risk, play important roles in determining the flows of FDI into the CEECs and help to explain the differing attractiveness of the individual countries to foreign investors.

Keywords
  • Transition economies; FDI; Panel estimation
Disciplines
Publication Date
2004
Citation Information
Kai Carstensen and Farid Toubal. "Foreign Direct Investment in Central and Eastern European Countries: A Dynamic Panel Analysis" Journal of Comparative Economics Vol. 32 (2004)
Available at: http://works.bepress.com/kai_carstensen/8/