FDI and Economic Growth in Central and Eastern Europe

Abstract

This paper discusses the major trends in scholarship about the role of FDI and exports on economic growth, the effect of tax policies on FDI, the formation of the economic catch up of the Central and Eastern Europe (CEE) region and the determinants of FDI inflows in CEE nations. I am specifically interested in how previous research investigated the influence of FDI on host country economic growth, the inward FDI stock as a percentage of GDP, the features and restrictions of fiscal schemes in CEE economies and the institutional soundness displayed in policies towards FDI. The analysis presented in this paper contributes to research on FDI as a mechanism in the transition to the market, the dissimilarities in the FDI-assisted development methods among the CEE nations, the impact of FDI inflows for productivity convergence in CEE and the current slowing of growth in emerging Europe.