Institutions and FDI: Impact Analysis by Countries’ Income Level
Journal: International journal of institutions and economies/Institutions and economies
Year: 2022

This paper scrutinises the relationship between foreign direct investment (FDI) and institutional quality using panel data for 44 high-, 39 upper middle-, 23 low- and 35 lower middle-income countries over the period 2000 to 2017. We revisit the relationship by using a composite institutional index of World Governance Indicators (WGI), constructed using principal component analysis (PCA). Further, we extend the analysis to estimate the impact of the different dimensions of WGI indicators on FDI f