TY - JOUR
T1 - Determinants of Foreign Direct Investment in GCC Countries
T2 - An Empirical Analysis
AU - AL-MATARI, Ebrahim Mohammed
AU - MGAMMAL, Mahfoudh Hussein
AU - SENAN, Nabil Ahmed M.
AU - ALHEBRI, Adeeb Abdulwahab
N1 - Publisher Copyright:
© Copyright: The Author(s) This is an Open Access article distributed under the terms of the Creative Commons Attribution Non-Commercial License (https://creativecommons.org/licenses/by-nc/4.0/) which permits unrestricted non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited.
PY - 2021
Y1 - 2021
N2 - The aim of this paper is to identify the key determinants in the Gulf Cooperation Council (GCC) countries for Foreign Direct Investment (FDI) inflows by using a balanced data panel for the period from 1995 to 2018. This study covers GCC countries in their entirety. The study uses ten explanatory variables, namely, trade ratio, gross domestic product, external balance, fuel exports, gross savings, international tourism, military expenditure, net foreign assets, services value added, and total natural resources. The authors have tried to find the best fit model from the differences methods considered such as OLS, GLS regression with the help of Hausman test, and country by country regressions as additional analysis. The study revealed a significantly positive association between inflation, trade ratio, gross domestic product, gross savings, and net foreign assets with FDI. On the contrary, international tourism was revealed to have a negative association with FDI. The sample of all GCC countries chosen for this study has not been considered widely by any earlier study. Moreover, this study covered many determinants of FDI that add to the previous literature. It is a significant contribution to the current research body and stresses the originality of this paper.
AB - The aim of this paper is to identify the key determinants in the Gulf Cooperation Council (GCC) countries for Foreign Direct Investment (FDI) inflows by using a balanced data panel for the period from 1995 to 2018. This study covers GCC countries in their entirety. The study uses ten explanatory variables, namely, trade ratio, gross domestic product, external balance, fuel exports, gross savings, international tourism, military expenditure, net foreign assets, services value added, and total natural resources. The authors have tried to find the best fit model from the differences methods considered such as OLS, GLS regression with the help of Hausman test, and country by country regressions as additional analysis. The study revealed a significantly positive association between inflation, trade ratio, gross domestic product, gross savings, and net foreign assets with FDI. On the contrary, international tourism was revealed to have a negative association with FDI. The sample of all GCC countries chosen for this study has not been considered widely by any earlier study. Moreover, this study covered many determinants of FDI that add to the previous literature. It is a significant contribution to the current research body and stresses the originality of this paper.
KW - FDI Inflows
KW - Foreign Direct Investment
KW - GCC Economies
KW - Panel Data Approach
UR - http://www.scopus.com/inward/record.url?scp=85104021825&partnerID=8YFLogxK
U2 - 10.13106/jafeb.2021.vol8.no4.0069
DO - 10.13106/jafeb.2021.vol8.no4.0069
M3 - Article
AN - SCOPUS:85104021825
SN - 2288-4637
VL - 8
SP - 69
EP - 81
JO - Journal of Asian Finance, Economics and Business
JF - Journal of Asian Finance, Economics and Business
IS - 4
ER -