Are the Central and East European Countries attracting the appropriate type of foreign direct investments?

Vasile Alecsandru STRAT
Academia de Studii Economice


Measuring and studying the relationship between the inflows of FDIs received by a country and the openness of its market might shed some light on the typology of foreign investments attracted by that country. The FDIs can be clustered, as the literature states, in a dichotomous fashion, in vertical FDIs, searching for efficiency and horizontal FDIs mainly interested in acquiring new markets. Thus, it is of crucial importance for an economy to be able to design policies that will encourage those foreign investments which bring the most important benefits for the host country. In this research paper, using the T-Y procedure, we try to identify some aspects useful in identifying the general typology of the FDIs attracted by a sample of five central and east European countries (members of the EU).

Key words: Foreign Direct Investment, Market openness index, Imports and Exports, Granger Causality analysis, Toda-Yamamoto procedure

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Romanian Statistical Review 4/2015