How does political risk matter for foreign direct investment into Arab economies? - Archive ouverte HAL Accéder directement au contenu
Article Dans Une Revue Middle East Development Journal Année : 2023

How does political risk matter for foreign direct investment into Arab economies?

Résumé

The present paper extends previous work by Burger et al. ([2016]. Risky business: Political instability and sectoral greenfield foreign direct investment in the Arab world. World Bank Economic Review, 30(2), 306–331. https://doi.org/10.1093/wber/lhv030) that has attempted to investigate empirically the impact of political instability on FDI flows into the Arab host region. Specifically, based on gravity model approach and annual panel dataset on bilateral FDI projects in Arab countries from 2003 to 2018 (12,240 projects), it explores the following research questions: how does a host country’s political instability and institutional fragility affect the bilateral inward FDI project? Is there any sectoral specificity to this impact if it exists? Which component of political risk poses the most threat for the foreign investor in a specific sector? The empirical investigation highlights the negative, significant and robust impact of perceived political risk in the Arab host-country. It also establishes that there is substantial heterogeneity in foreign investment reactions to political risk reflecting both differences in the component of political risk and sectoral characteristics.
Fichier non déposé

Dates et versions

hal-04198168 , version 1 (06-09-2023)

Identifiants

Citer

Riadh Ben Jelili. How does political risk matter for foreign direct investment into Arab economies?. Middle East Development Journal, 2023, pp.1-20. ⟨10.1080/17938120.2023.2254190⟩. ⟨hal-04198168⟩
34 Consultations
0 Téléchargements

Altmetric

Partager

Gmail Facebook X LinkedIn More