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Spatial Econometric Analysis of Foreign Direct Investment Determinants in Russian Regions
Author(s) -
Ledyaeva Svetlana
Publication year - 2009
Publication title -
world economy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.594
H-Index - 68
eISSN - 1467-9701
pISSN - 0378-5920
DOI - 10.1111/j.1467-9701.2008.01145.x
Subject(s) - foreign direct investment , competitor analysis , economics , international economics , financial crisis , econometric model , panel data , investment (military) , international trade , politics , economic geography , economy , monetary economics , macroeconomics , econometrics , political science , management , law
Using a spatial autoregressive model of cross‐sectional and panel data, we study the determinants and dominant strategies of foreign direct investment (FDI) inflows into Russia before and after the 1998 financial crisis. The important determinants of FDI inflows into Russian regions since the start of transition appear to be market size, the presence of large cities and sea ports, oil and gas availability, proximity to European market, and political and legislative risks. Since 1998, it appears the importance of big cities, the Sakhalin region, oil and gas resources, proximity to European markets, and legislation and political risks has increased. Our results also reveal a shift from horizontal FDI strategy to vertical FDI strategy in the post‐crisis period. Using a multiple spatial lags approach, we show that neighbouring port‐endowed regions tend to have emerged in the post‐crisis era as competitors for FDI.