Document Type : Original Article
Authors
1
Assistant Professor of Economics, Department of Economics Faculty of Economics and Social Science, Bu-Ali Sina University, Hamedan-Iran
2
Professor of Economics, Department of Economics Faculty of Social Sciences & Economics, Alzahra University, Tehran, Iran.
3
MA of Economics, Department of Economics Faculty of Economics and Social Science, Bu-Ali Sina University, Hamedan, Iran
10.48308/jem.2026.241357.2007
Abstract
Foreign direct investment is one of the factors affecting economic development, which has an impact on economic structures and also facilitates the entry of up-to-date global technologies into the host country. Factors affecting the production function include capital, technology, and management. Due to the shortcomings in these factors, developing countries are at a lower level in terms of production compared to developed countries. These countries need optimal management, new technologies, and increased capital in order to improve the productivity of production factors. Although there are various methods to meet the aforementioned needs, one of the most effective solutions is to attract foreign direct investment. Through this type of investment, the transfer of technology, capital, and resources is possible, and it is also possible to increase the productivity of production factors, which will ultimately bring the per capita income of developing countries closer to that of developed countries. This study examines the impact of investment environment components on attracting foreign direct investment in selected developing countries during the period 2007-2023 and estimates them using the SGMM approach. The investment environment is introduced with the components of property rights, investor protection, contract enforcement, financing ecosystem, and international investment restrictions. The estimation results indicate the positive impact of property rights, investor protection, contract enforcement, financing ecosystem, and international investment restrictions, as well as physical capital, employment, and natural resource rents on foreign direct investment.
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