Measuring and analysis the impact of the index of economic freedom in FDI in selected countries for the period (2013-2015)

Abstract

FDI is one of the variables influencing the development and growth of countries and a sign of the openness of the economy and its ability to cope with global developments, under the rule of globalization, the increasing shift towards market mechanism and the control of multinational companies on the movement of goods and services, opening markets and increasing the volume of financial flows. Economic freedom to increase foreign direct investment.The research aims at showing the impact of the index of economic freedom in 2013 on foreign direct investment as a variable for the year 2015, ie, a two-year time lag by using the simple linear and nonlinear regression analysis of the surveyed countries, using a cross-sectional sample of 60 countries.According to the Pearson correlation coefficient, there is a significant correlation between the index of economic freedom and foreign direct investment. It is clear from the estimation of regression equations that if the index of general economic freedom increases by one unit, foreign direct investment will increase by 30.15 million dollars American.The study recommended that countries should increase economic freedom. The impact of economic freedom on foreign direct investment is positive and work to be free from administrative and financial corruption because this will encourage the economic activities of the private sector and increase the flow of foreign direct investment.