DETERMINANT FACTORS OF FDI IN DEVELOPED AND DEVELOPING COUNTRIES IN THE EU

Abstract

Influencing factors of FDI are economic, social and political. The contextual factors can have a substantial influence on FDI inflows and outflows. The proposed analysis will identify whether there is a direct relationship between economic growth and FDI flows. In this paper, I will analyse the situation of four countries, namely Romania, Hungary, Bulgaria, the United Kingdom and the European Union to see the influence of GDP growth per capita on increasing the share of FDI in GDP and to what extent. Another potential factor influencing FDI inflows is represented by the exports and imports of a country, most of the studies concluding on a significant positive relationship of the trade flows over the FDI inflows. This will prove that FDI is not a substitute of the trade flows but an additional element, together contributing to increase the role of the state in the global economic system.Abstract will be written in English.

Keywords

• Foreign Direct Investments (FDI)
• Economic growth
• FDI flows