Indicators of business environment, institutional quality and foreign direct investment in Gulf Cooperation Council (GCC) countries

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This paper empirically investigates the effect of five business environment indicators and four measures of institutional quality on FDI inflows in GCC countries. The empirical results reveal that the time required to start a business, the time required to enforce a contract, the time required to register a property and the time required to resolve insolvency are negatively and statistically significantly correlated with FDI inflows. Our findings also confirm that political instability and absence of democracy, in fact, encourages FDI inflows. We conclude that the business environment strongly matters for FDI inflows into the GCC countries.

Original languageEnglish
Pages (from-to)515-530
Number of pages16
JournalInternational Review of Applied Economics
Issue number4
Publication statusPublished - Jul 2013



  • business environment
  • Foreign direct investment
  • GCC countries
  • growth
  • institutional quality
  • openness

ASJC Scopus subject areas

  • Economics and Econometrics

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