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EUROPEAN INTERNAL MARKET AND FOREING DIRECT INVESTMENT. THE DETERMINANTS OF FDI

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Abstract

In this paper we intended to analyse the effects that the incorporation of ten candidate states to the EU- in May 2004- will have over their economies. We studied the role that foreign direct investment (FDI) has played in these countries. We also showed how a country attracts FDI, taking into account size and other factors to which foreign investors are sensitive. In this connection, we monitored several indices to consider social, political and institutional factors which can be relevant to foreign investors from a competitive point of view. Another question to be answered is whether the new regional integration would modify the location of activities in the European countries. We will analyse this question by the role of multinationals companies across Europe.

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