Determinants of Foreign Direct Investments in Bulgaria and Romania in the Context of Recent Economic Crisis
Journal Title: Academic Journal of Economic Studies - Year 2017, Vol 3, Issue 1
Abstract
The objective of this paper is to select some relevant macroeconomic determinants for foreign direct investment (FDI) in Bulgaria and Romania since the start of the recent economic crisis (2008-2015). Even if the economic recession installed in 2009 in Romania, the foreign investors’ decisions were influenced by the moment of global recession from 2008. A Bayesian approach was proposed, because of the small sample for the variables in analyzed period: FDI as percent of GDP, real GDP rate, unemployment rate, inflation rate, real interest rate, real effective exchange rate index (2010=100) and money demand (M2) as percent of GDP. The estimation results reflected that foreign investors in both countries were attracted by the increase in GDP from a year to another. On the other hand, for Bulgaria the inflation rate was the strongest determinant, indicating the economic stability of the country that made huge efforts in getting one digit inflation rate. In Romania, as expected, the foreign investors were searching for cheap labour force and the increase in unemployment rate attracted more FDI during the crisis period.
Authors and Affiliations
Mirel-Daniel Simionescu
Keywords
Related Articles
- EP ID EP178080
- DOI -
- Views 88
- Downloads 0
Online Advertising Impact in the Bio Products Decision Purchase Process
As time passes by, people have become more and more interested in a healthy lifestyle. This is due to a number of external factors (stress, fatigue, sedentariness) that harm the general health of the body. The main idea...
Matrix Factor Seed Bambang Lanang Business Strategies in Indonesia
The purpose of this study is to establish the internal factors and external factors Bambang Lanang seed business in the village of Muara Muara Payang Payang Lahat District - South Sumatra - Indonesia. This research is a...
The Asymmetric Effect in the Volatility of the South African Rand
This study investigates the behaviour of the volatility in the South African Rand/USD exchange rate and its impact on the value of the Rand between 2001 and 2017. The key objectives were to assess the impact of its volat...
Risk - Return Relationship: Nigerian Stock Market during Pre and Post 2007-2009 Financial Meltdown
Financial crises are economic phenomena often heralded by asset and credit booms or bubbles. This study examines risk-return relationship in the context of Nigeria during pre and post financial meltdown of 2007-2009. GAR...
On the Reaction of Stock Market to Monetary Policy Innovations: New Evidence from Nigeria
The paper analysed the asymmetric effect of monetary policy to stock market in Nigeria. The study is conducted by using an EGARCH(X) model. The exogenous variable is a dummy variable which account for the monetary policy...