Institutional Clusters and FDI Flows to the MENA Region

Wasseem Mina

doi:10.1007/978-3-319-50164-2_14

Institutional Clusters and FDI Flows to the MENA Region

Wasseem Mina

Research output: Chapter in Book/Report/Conference proceeding › Chapter

1 Citation (Scopus)

Abstract

The empirical literature on the institutions-FDI nexus has treated the influence of institutions individually despite the correlation among them. This is a conceptual shortcoming. To overcome this limitation, we cluster institutions using Principal Component Analysis (PCA). We apply PCA to ICRG institutions for 17 Middle East and North Africa countries during the period 1984–2011. Three institutional clusters have been extracted: stability and order, quality of public administration, and presence of democratic systems. Using feasible generalized least squares estimation methodology, estimates show that stability and order and the presence of a democratic system have a positive influence on FDI flows, while the quality of public administration has a surprisingly negative influence.

Original language	English
Title of host publication	Eurasian Studies in Business and Economics
Publisher	Springer Science and Business Media B.V.
Pages	243-252
Number of pages	10
DOIs	https://doi.org/10.1007/978-3-319-50164-2_14
Publication status	Published - 2017
Externally published	Yes

Publication series

Name	Eurasian Studies in Business and Economics
Volume	6
ISSN (Print)	2364-5067
ISSN (Electronic)	2364-5075

Keywords

FDI
Institutional clusters
Institutions
MENA
Principal component analysis

ASJC Scopus subject areas

General Economics,Econometrics and Finance
General Business,Management and Accounting

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10.1007/978-3-319-50164-2_14

Cite this

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abstract = "The empirical literature on the institutions-FDI nexus has treated the influence of institutions individually despite the correlation among them. This is a conceptual shortcoming. To overcome this limitation, we cluster institutions using Principal Component Analysis (PCA). We apply PCA to ICRG institutions for 17 Middle East and North Africa countries during the period 1984–2011. Three institutional clusters have been extracted: stability and order, quality of public administration, and presence of democratic systems. Using feasible generalized least squares estimation methodology, estimates show that stability and order and the presence of a democratic system have a positive influence on FDI flows, while the quality of public administration has a surprisingly negative influence.",

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AU - Mina, Wasseem

PY - 2017

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N2 - The empirical literature on the institutions-FDI nexus has treated the influence of institutions individually despite the correlation among them. This is a conceptual shortcoming. To overcome this limitation, we cluster institutions using Principal Component Analysis (PCA). We apply PCA to ICRG institutions for 17 Middle East and North Africa countries during the period 1984–2011. Three institutional clusters have been extracted: stability and order, quality of public administration, and presence of democratic systems. Using feasible generalized least squares estimation methodology, estimates show that stability and order and the presence of a democratic system have a positive influence on FDI flows, while the quality of public administration has a surprisingly negative influence.

AB - The empirical literature on the institutions-FDI nexus has treated the influence of institutions individually despite the correlation among them. This is a conceptual shortcoming. To overcome this limitation, we cluster institutions using Principal Component Analysis (PCA). We apply PCA to ICRG institutions for 17 Middle East and North Africa countries during the period 1984–2011. Three institutional clusters have been extracted: stability and order, quality of public administration, and presence of democratic systems. Using feasible generalized least squares estimation methodology, estimates show that stability and order and the presence of a democratic system have a positive influence on FDI flows, while the quality of public administration has a surprisingly negative influence.

KW - FDI

KW - Institutional clusters

KW - Institutions

KW - MENA

KW - Principal component analysis

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M3 - Chapter

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EP - 252

BT - Eurasian Studies in Business and Economics

PB - Springer Science and Business Media B.V.

ER -

Institutional Clusters and FDI Flows to the MENA Region

Abstract

Publication series

Keywords

ASJC Scopus subject areas

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