The changing direction of foreign direct investment towards developing countries has been\nattracting more attention in recent literature. As one possible source of the changing direction\nof FDI, the relationship between FDI inflows and some indicators of business friendliness\n(investment climate) of countries is investigated in this paper. The study covers the years from\n2004 to 2013 and mainly focuses on developing countries. The results show that countries with\nbetter records of doing business tend to receive more FDI inflows. Improvements in the\nselected ease of doing business indicators, such as starting a business, protecting investors, and\neasiness of international trade, have a significant explanatory power in determining higher FDI\nflows to developing countries.
Loading....