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Interactive Impact of Armed Conflicts on Foreign Direct Investments in Africa
Author(s) -
Ezeoha Abel Ebeh,
Ugwu John Okereke
Publication year - 2015
Publication title -
african development review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.654
H-Index - 32
eISSN - 1467-8268
pISSN - 1017-6772
DOI - 10.1111/1467-8268.12161
Subject(s) - armed conflict , natural resource , foreign direct investment , resource (disambiguation) , development economics , economics , international trade , business , international economics , political science , macroeconomics , computer network , computer science , law
This study examined the interactive impact of armed conflicts on FDI flows into Africa. A dataset involving 41 African countries and a dynamic system GMM model were adopted. The findings showed that conflict had a significant negative effect on FDIs; and that infrastructural development significantly moderated the impact of conflicts. The study also revealed that the impact of conflict was higher for natural resource‐rich countries than for non‐resource‐rich countries, and that the impact was both regional and seasonal sensitive. The findings suggest that rebuilding conflict‐induced infrastructure destructions can play significant role in attracting FDIs even in conflict‐prone countries of Africa.