Towards a better understanding of driving factors for FDI allocation. A country's goodwill: a new host country's FDI determinant?

This Thesis proposes a new approach to explaining the allocation of foreign direct investments (FDI), by applying the accounting framework for valuating a company’s intangible assets at a country level. This framework allows us to identify a valuable group of a country’s assets that previously had not been taken into account: a group of assets that forms a country’s Goodwill, or national Goodwill. National Goodwill includes all those unmeasurable, unquantifiable or not easily identifiable assets that add to (or subtract from) a country’s market value and that can, in turn, generate FDI inflows. The research shows how a simple accounting method identifying a company’s goodwill can be adapted into a formula that proxies a country’s Goodwill. By identifying and then quantifying a particular country’s Goodwill, for a large sample of countries, this Thesis postulates that it is possible to test the power of a country’s Goodwill to explain the cross-sectional and time-series variation in FDI flows for a broad set of countries. The ultimate aim of this research is, by placing the difficult to factor, yet extremely important -‘intangible assets’ of a country,- into a more quantifiable form, to provide a much needed specificity to our understanding of the factors that more accurately define a country’s value and attractiveness for FDI investments.

Name dc:type.qualificationname

phd

Level dc:type.qualificationlevel

doctoral

Grantor dc:publisher.institution

City, University of London

Year dc:date.issued

2017

Author dc:creator

• Sarno, Y.

• HG Finance