DEVELOPING COUNTRIES’ STRATEGIES IN ATTRACTING U.S. MULTINATIONAL COMPANIES’ FOREIGN DIRECT INVESTMENTS IN THE INFORMATION INDUSTRY AFTER RECENT 2008 FINANCIAL CRISIS
Foreign direct investments inflow toward developing countries is still one of the main drivers for economic growth for many developing countries. Despite the 2008 financial crisis, recent global trends show that foreign direct investments from U.S. multinational corporates are nevertheless the top source for developing countries to pursue financial inflows and business stimuli. Several studies have examined patterns of attracting FDIs in multilateral levels that focus on aggregate economic outcomes at the country level. Using a new disaggregated dataset that focuses on U.S. MNCs’ FDIs in other developing countries, and Ordinary Least Squares regressions with country and year fixed effects, and random effects, this paper builds on previous research by providing an examination of the pattern of U.S. MNCs’ operational activities. It particularly focuses on the information industry in developing countries at the disaggregated level. The findings of this analysis suggest that traditional strategies, deregulation, and improving business environment, are positively associated with the inflow of U.S. MNCs’ FDIs in the information industry. In light of the empirical evidence of this study, governments would be well advised to reshape their country strategies in attracting U.S. MNCs’ FDIs in the information industry.
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