Attraction of Foreign Direct Investment Inflows from the Transnational Corporations in the Condition of Transition Economy
Attraction of Foreign Direct Investment Inflows from the Transnational Corporations in the Condition of Transition Economy

Summary/Abstract: This study examines driving factors of foreign direct investment provided by transnational corporations. The authors address this question by examining how trade openness, financial development, exchange rate, infrastructure, corruption affecting on country attractiveness for investing by corporations. The researchers analyze data for the years 1998 –2017 of Republic of Kazakhstan in the framework of Eurasian Economic Union. The authors find that foreign direct investment have a strong positive effect on trade openness and the exchange rate also shows significant positive small effects, while infrastructure shows a significant negative small effect. Further, the researchers find that Foreign direct investment (FDI) in developing countries can be mutually beneficial for both the host country and transnational corporations. Thus the article identifies the negative and positive effects of FDI for the host country, as well as dividing the importance of allocating FDI for the economic growth of the Republic of Kazakhstan.

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