Spatial Determinants of Foreign Direct Investment: Evidence from OECD Countries

The direct foreign investment movements (FDIM) often discussed through determinants, are notable in the literature for being primarily examined in terms of their economic aspects. However, it is observed that the importance of the spatial concept, a significant determinant of DFIM, is not adequately emphasized. The main purpose of the study, which focuses on this identified gap, is to determine the extent of the interaction between DFIM movements and spatial dynamics. In this regard, the spatial complex, regarded as a sociocultural foundation, is elaborated with its geographical and institutional dimensions. In the study, the spatial determinants of DFIM are investigated for OECD countries using the System Generalized Method of Moments (GMM) for the period 2001-2017. The results indicate that spatial dynamics play a decisive role in FDIM movements, with institutional indicators, in particular, exerting a higher level of influence.