Determinant factors of foreign direct investment: some empirical evidence

Abstract

This paper reports on an empirical study based on 103 Spanish companies which have conducted foreign direct investment (FDI). Built on the eclectic paradigm, it aims at finding out the main ownership, internalization and location factors which affect such internationalization processes. The results confirm the determinant importance of factors such as the existence of specific assets of an intangible nature. They also show that transaction costs and other questions related to knowledge transfer and accumulation are relevant in the choice of FDI over alternative forms of internationalization. Current and future markets and their expected growth are the key factors for selecting a destination. In general, this paper provides evidence that what is known about determinants of FDI seems to extend to Spanish multinationals today.

Citation

Galán, J.I. and González‐Benito, J. (2001), "Determinant factors of foreign direct investment: some empirical evidence", European Business Review, Vol. 13 No. 5, pp. 269-278. https://doi.org/10.1108/EUM0000000005795