Natural-resource or Market-seeking FDI in Russia? An Empirical Study of Locational Factors Affecting the Regional Distribution of FDI Entries

This paper analyzes the spatial distribution of foreign direct investment (FDI) across regions in Russia. Our analysis employs data on Russian firms with a foreign investor during the 2000-2009 period and links regional statistics in the conditional logit model. The main findings are threefold. First, we conclude that market-related factors and the availability of natural resources are important factors in attracting FDI. Second, existing agglomeration economies encourage foreign investors. Third, the findings imply that service-oriented FDI co-locates with extraction industries in resource-endowed regions.

11. April 2013

Authors K. Gonchar Philipp Marek

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