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Regular version of the site

Article

The regional distribution of foreign investment in Russia. Are Russians more appealing to multinationals as consumers or as natural resource holders?

Economics of Transition. 2014. Vol. 22. No. 4. P. 605-634.
Gonchar K. R., Marek P.

This article conducts a plant-level study of the factors affecting foreign direct investment (FDI) inflow to a large openning economy endowed with specific factor advantages. We conclude that the distribution of FDI in the Russian regions depends on market access and can be most notably by the knowledge-capital framework. Factor endowments built by natural resources are more successful in explaining the location decisions of export-platform affiliates. The impact of natural resources depends on how the availability of these resources is measured. The results reject the crowding-out effects of resource FDI and prove co-location mode, when service investments are attracted to  resource-rich regions. Labour cost advantages better explain  the preferences of non-trading service affiliates