Mapping the Foreign Investments (OFDI) From Emerging Economies Toward Developed Nations: A Consequential Convergence of Investment Outflows and the OLI Paradigm

What is it about?

A fascinating insight we present in this research is what instigated the flow of outward FDI from emerging economies (EE) to developed nations by employing the O-L-I framework. Here, we offer the novelty of our research through earlier studies that only used the O-L-I framework to understand the genesis of FDI outflow from developed nations (DN) to developing/emerging economies. The mapping of investment patterns from EE materialized in 3-D (EE to DN, EE to EE, and DN to EE) by incorporating country-specific ownership, location, and internalization advantages. Twenty years of panel data have been used from nine countries. We used pooled OLS, random-effects, and fixed-effect models to understand the cause–effect relationship. Our findings exhibit that technological advancement, infrastructure, and economic stability are the major drivers for outward investment flow from one nation to another. In addition, patents and infrastructure can initiate the outward flow of FDI from emerging countries to developed countries.

Featured Image