Analysis of government policies, institutions, and inward foreign direct investment: evidence from sub-Saharan Africa

Ochuko B. Emudainohwo, Agyenim Boateng, Sanjukta Brahma, Franklin Ngwu

    Research output: Contribution to journalArticle

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    Abstract

    This article examines the effects of government policies and institutions on foreign direct investment (FDI) inflows in sub-Saharan African context using both quantitative and qualitative approaches. On the quantitative approach, we analyzed the effects of institutions on FDI using two statistical techniques—canonical cointegration regression (CCR) and fully modified ordinary least square (FMOLS)—over the period of 1984–2012. We find that political instability, democratic accountability, and investment risk have significant impact on inward FDI in Nigeria. Using a trend analysis, our results provide evidence to suggest that liberal government investment policies have positive influence on FDI inflows. Our qualitative analysis over the 1962–2012 period supports the results of the quantitative analysis.
    Original languageEnglish
    Pages (from-to)523-534
    Number of pages12
    JournalThunderbird International Business Review
    Volume60
    Issue number4
    Early online date11 Sep 2017
    DOIs
    Publication statusPublished - Aug 2018

    Fingerprint

    foreign direct investment
    direct investment
    foreign investment
    government policy
    evidence
    inflow
    political instability
    investment policy
    trend analysis
    qualitative analysis
    accountability
    quantitative analysis
    Nigeria
    regression
    responsibility
    Africa
    analysis
    Government policy
    Sub-Saharan Africa
    Foreign direct investment

    Keywords

    • government policies
    • Africa
    • foreign direct investment

    Cite this

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    abstract = "This article examines the effects of government policies and institutions on foreign direct investment (FDI) inflows in sub-Saharan African context using both quantitative and qualitative approaches. On the quantitative approach, we analyzed the effects of institutions on FDI using two statistical techniques—canonical cointegration regression (CCR) and fully modified ordinary least square (FMOLS)—over the period of 1984–2012. We find that political instability, democratic accountability, and investment risk have significant impact on inward FDI in Nigeria. Using a trend analysis, our results provide evidence to suggest that liberal government investment policies have positive influence on FDI inflows. Our qualitative analysis over the 1962–2012 period supports the results of the quantitative analysis.",
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    Analysis of government policies, institutions, and inward foreign direct investment: evidence from sub-Saharan Africa. / Emudainohwo, Ochuko B.; Boateng, Agyenim; Brahma, Sanjukta; Ngwu, Franklin.

    In: Thunderbird International Business Review, Vol. 60, No. 4, 08.2018, p. 523-534.

    Research output: Contribution to journalArticle

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