EU-COUNTRY AND NON-EU-COUNTRY AT THE TIME OF CRISIS: FOREIGN DIRECT INVESTMENT

The global financial crisis affected the flows of foreign direct investment (FDI). This study focuses on two countries in the midst of the financial crisis: Iceland with IMF backup, and Ireland with ECB backup. The research focus is on the situation from the broad perspective of international econom...

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Bibliographic Details
Published in:Baltic Journal of Economic Studies
Main Authors: Helga Kristjánsdóttir, Stefanía Óskarsdóttir
Format: Article in Journal/Newspaper
Language:English
Published: Izdevnieciba “Baltija Publishing” 2020
Subjects:
european union
efta
ireland
iceland
global financial crisis
international trade
foreign direct investment (fdi)
Economic growth
development
planning
HD72-88
Iceland
Online Access:https://doi.org/10.30525/2256-0742/2020-6-3-19-23
https://doaj.org/article/2a67e37a453d49b787f729341ab63f50
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Summary:The global financial crisis affected the flows of foreign direct investment (FDI). This study focuses on two countries in the midst of the financial crisis: Iceland with IMF backup, and Ireland with ECB backup. The research focus is on the situation from the broad perspective of international economics and political atmosphere, combining government decisions with economic consequences. We analyze inward foreign direct investment, incorporating factors like economic size and stock market firms, receiving portfolio investment, rather than FDI. Our findings indicate that before the crisis the economic wealth in the domestic market to have positive effects on FDI, and firms receiving portfolio investment on the stock market are competing with FDI. This is the case for both Ireland and Iceland. However, after the crisis, these factors have insignificant impact on FDI.

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