Template-type: ReDIF-Paper 1.0
Author-Name: Wasseem Mina 
Author-Email: wmina@uaeu.ac.ae 
Author-Workplace-Name: Department of Economics and Finance, College of Business and Economics, United Arab Emirates University


Author-Name: Louis Jaeck 
Author-Email: louis_jaeck@uaeu.ac.ae
Author-Workplace-Name: Department of Economics and Finance, College of Business and Economics, United Arab Emirates University


Title: Labor Market Flexibility and FDI Flows: Evidence from Oil-Rich GCC and Middle Income Countries



Abstract: In this paper we empirically examine the impact of labor market flexibility on FDI flows to oil-rich GCC and compare it to middle income countries in 2006-2011. We account for potential endogeneity and nonstationarity and adopt system GMM and IV estimation methodologies. Our findings show that in middle income countries overall flexibility increases FDI flows under both system GMM and IV methodologies. In GCC countries overall LMF decreases FDI flows under system GMM methodology. Results also show a positive “GCC region” influence outweighing the negative flexibility influence. Growth potential and infrastructure development matter for both GCC and middle income countries. 

Length: 32 pages

Creation-Date: 2015-05-08

File-URL: http://icepp.gsu.edu/files/2015/07/ispwp1501.pdf

File-Format:application/pdf

Handle: RePEc:ays:ispwps:paper1501