Topics in Middle Eastern and North African Economies
Document Type
Article
Publication Date
5-1-2023
Abstract
This paper analyzes the role of the quality of governance on financial development to create favorable conditions to attract FDI in the MRNA region. Using a panel data and GMM method from 1985 to 2021, results show that the banking development variables (credit to the private sector) and capital account openness improve the attractiveness of FDI inflows. This effect is higher for countries above the governance threshold. However, the effects of the stock market variables (stock market value traded and capitalization) are significant and positive only in the developed group beyond a certain level of governance. Besides, the impacts of financial variables on the FDI attractiveness are less important in the natural resource endowed countries.
Journal Title
Topics in Middle Eastern and North African Economies
ISSN
2334-282X
Publisher
Middle East Economic Association and Loyola University Chicago
Volume
25
Issue
1
Recommended Citation
Ines, Trojette and Odjoumani, Nestor, "The Impact of Financial Development on the Attractiveness of Foreign Direct Investment in the MENA Region". Topics in Middle Eastern and North African Economies, electronic journal, 25, 1, Middle East Economic Association and Loyola University Chicago, 2023, http://www.luc.edu/orgs/meea/
Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.
Copyright Statement
© The Author(s), 2023
Comments
Presentation of the articles in the Topics in Middle Eastern and North African Economies was made possible by a limited license granted to Loyola University Chicago and Middle East Economics Association from the authors who have retained all copyrights in the articles.