Masudi, Ahmad Aswin
Center For Economic Studies Universitas Katolik Parahyangan

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An Analysis of Intra-ASEAN FDI Determinants in the Wake of ASEAN Economic Community Ahmad Aswin Masudi
Bina Ekonomi Vol. 20 No. 2 (2016)
Publisher : Center for Economic Studies Universitas Katolik Parahyangan

Show Abstract | Download Original | Original Source | Check in Google Scholar | Full PDF (2621.617 KB) | DOI: 10.26593/be.v20i2.2304.127-140

Abstract

This research intends to uncover the determinants of intra-ASEAN FDI, specifically to verify whether the establishment of ASEAN Economic Community has had any contribution to the raising intra-FDI inflow. Result from the fixed effect model with cross-section effects, which was employed to dataset of 10 ASEAN member states from 2000-2013, indicates that market size, quality of infrastructure, as well as labor productivity, were significant, and positively attracted intra-FDI inflow. Meanwhile, macroeconomic stability and degree of openness were insignificant. In addition, trade barrier was significantly proven to have negative effect on intra-FDI inflow. Unfortunately, the latest ASEAN’s investment scheme was insignificant. Moreover, the country-specific effects were highly significant, proving that heterogeneity seems to have an important role in attracting intra-ASEAN FDI. Keywords: intra-regional, foreign investment, economic integration, panel data.