TY  - JOUR
AU  - Blonigen, Bruce A
AU  - Piger, Jeremy
TI  - Determinants of Foreign Direct Investment
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 16704
PY  - 2011
Y2  - January 2011
DO  - 10.3386/w16704
UR  - http://www.nber.org/papers/w16704
L1  - http://www.nber.org/papers/w16704.pdf
N1  - Author contact info:
Bruce Blonigen
Department of Economics
1285 University of Oregon
Eugene, OR 97403-1285
Tel: 541/346-4680
Fax: 541/346-1243
E-Mail: bruceb@uoregon.edu

Jeremy Piger
Depart. of Economics
University of Oregon
Eugene, OR  97403-1285
E-Mail: jpiger@uoregon.edu
M1  - published as Rachael E. Goodhue, Carlo Russo. "Modeling Processor Market Power and the Incidence of Agricultural Policy: A Nonparametric Approach," in Joshua S. Graff Zivin and Jeffrey M. Perloff, editors, "The Intended and Unintended Effects of U.S. Agricultural and Biotechnology Policies" University of Chicago Press (2012)

AB  - Empirical studies of bilateral foreign direct investment (FDI) activity show substantial differences in specifications with little agreement on the set of covariates that are (or should be) included. We use Bayesian statistical techniques that allow one to select from a large set of candidates those variables most likely to be determinants of FDI activity. The variables with consistently high inclusion probabilities are traditional gravity variables, cultural distance factors, parent-country per capita GDP, relative labor endowments, and regional trade agreements. Variables with little support for inclusion are multilateral trade openness, host country business costs, host-country infrastructure (including credit markets), and host-country institutions. Of particular note, our results suggest that many covariates found significant by previous studies are not robust.
ER  -