Mariev, O. S., & Chipchagova, D. V. (2020). Assessment of Determinants of Foreign Direct Investment in Russian Regions. Zhurnal Economicheskoj Teorii [Russian Journal of Economic Theory], 17 (3), 752-759.
This paper investigates the impact of climate in Russian regions and other factors on foreign direct investment inflows. We use the generalized method of moments with endogeneity correction using internal instrumental variables (selection of the order of the lags of the endogenous regressor) to estimate the regression equation. The research is based on the data on 82 Russian regions in 1999–2018. It was found that foreign investors tend to favour northern regions, which could be explained by the abundance of mineral resources in these regions and the availability of seaports. We also found a direct relationship between the volumes of extracted minerals and the dependent variable. However, the region’s specialization in production of ferrous and non-ferrous metals does not create additional inflows of foreign direct investment or can even cause its outflow. The research findings can be used in regional strategy development.