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Determining Foreign Direct Investment Inflows of African Nations through Property Rights

Simonis, Melle Adrianus (2020) Determining Foreign Direct Investment Inflows of African Nations through Property Rights. Master thesis.

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Abstract

Foreign direct investment (FDI) plays an important role in the development of the nations on the African continent. However, the success of these nations in attracting FDI is low when compared to the developing nations outside the continent. A possible explanation for this is the poor state of the continent’s property rights, which may discourage potential investors from investing in and developing Africa’s land. This study provides the first continental-scale analysis of whether property rights determine the level of FDI flows towards African nations. I examine the effect of property rights protection on the inflow of FDI within 27 African nations through a panel data analysis. The results show that nations with the most well-defined and enforced property rights systems receive on average three times more FDI than nations with the weakest property rights. Additional findings demonstrate when property rights are weaker, more Chinese FDI is attracted by the nation’s natural resources. This study’s findings demonstrate the importance of property rights in creating an enabling environment for investors and also indicate how this enabling environment is different for Chinese investors.

Item Type: Thesis (Master)
Degree programme: Real Estate Studies
Supervisor: Daams, M.N.
Date Deposited: 02 Sep 2020 07:10
Last Modified: 02 Sep 2020 07:10
URI: https://frw.studenttheses.ub.rug.nl/id/eprint/3348

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