Foreign direct investment and democracy: a robust fixed effects approach to a complex relationship

Rodolphe Desbordes, Vincenzo Verardi

Research output: Contribution to journalArticle

1 Citation (Scopus)
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Abstract

We develop a new robust-to-outliers dummy estimator that we subsequently apply to investigate the impact of various democratic attributes on foreign direct investment (FDI) in recent years. We find that democracy has generally a positive impact on FDI, once outliers are controlled for, but that this relationship is very specific to each host country’s characteristics.
Original languageEnglish
Pages (from-to)43-82
Number of pages40
JournalPacific Economic Review
Volume22
Issue number1
DOIs
Publication statusPublished - 22 Feb 2017

Keywords

  • foreign direct investment
  • democracy
  • S-estimator
  • categorical variables
  • Stahel-Donoho estimate

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