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The relationship between FDI, political and institutional risk in Sub-Saharan Africa

This study uses Generalised Meod of Moments to investigate the roles of political risk and institutional quality determinants of Foreign Direct Investment inflows to 20 countries in SubSaharan Africa between 2003 and 2019. The results show that both political risk and weak institutional quality sign...

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Main Author: Matima, Zorodzai
Other Authors: Gossel, Sean J
Format: Thesis
Language:English
Published: Graduate School of Business (GSB) 2022
Subjects:
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access_status_str Open Access
author Matima, Zorodzai
author2 Gossel, Sean J
author_browse Gossel, Sean J
Matima, Zorodzai
author_facet Gossel, Sean J
Matima, Zorodzai
author_sort Matima, Zorodzai
collection Thesis
description This study uses Generalised Meod of Moments to investigate the roles of political risk and institutional quality determinants of Foreign Direct Investment inflows to 20 countries in SubSaharan Africa between 2003 and 2019. The results show that both political risk and weak institutional quality significantly and negatively affect FDI in Sub-Saharan Africa. The GMM interaction terms for institutional quality are larger than those for political risk. These results emphasize the importance of institutional quality above that of the political system, suggesting that institutional quality is more attractive to foreign investors than a sound political system. This is probably because foreign investors are more concerned with long-run regulatory enforcement and investment protection than by short-run political dynamics.
format Thesis
id oai:open.uct.ac.za:11427/35865
institution University of Cape Town (South Africa)
language eng
last_indexed 2026-06-10T12:31:47.142Z
license_str Not specified — see source repository
provenance_str_mv Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository
publishDate 2022
publishDateRange 2022
publishDateSort 2022
publisher Graduate School of Business (GSB)
publisherStr Graduate School of Business (GSB)
record_format dspace
source_str UCTD — University of Cape Town Open Access Repository
spelling oai:open.uct.ac.za:11427/35865 The relationship between FDI, political and institutional risk in Sub-Saharan Africa Matima, Zorodzai Gossel, Sean J business This study uses Generalised Meod of Moments to investigate the roles of political risk and institutional quality determinants of Foreign Direct Investment inflows to 20 countries in SubSaharan Africa between 2003 and 2019. The results show that both political risk and weak institutional quality significantly and negatively affect FDI in Sub-Saharan Africa. The GMM interaction terms for institutional quality are larger than those for political risk. These results emphasize the importance of institutional quality above that of the political system, suggesting that institutional quality is more attractive to foreign investors than a sound political system. This is probably because foreign investors are more concerned with long-run regulatory enforcement and investment protection than by short-run political dynamics. 2022-03-01T15:49:41Z 2022-03-01T15:49:41Z 2021 2022-03-01T15:49:18Z Master Thesis Masters MBA http://hdl.handle.net/11427/35865 eng application/pdf Graduate School of Business (GSB) Faculty of Commerce
spellingShingle business
Matima, Zorodzai
The relationship between FDI, political and institutional risk in Sub-Saharan Africa
thesis_degree_str Master's
title The relationship between FDI, political and institutional risk in Sub-Saharan Africa
title_full The relationship between FDI, political and institutional risk in Sub-Saharan Africa
title_fullStr The relationship between FDI, political and institutional risk in Sub-Saharan Africa
title_full_unstemmed The relationship between FDI, political and institutional risk in Sub-Saharan Africa
title_short The relationship between FDI, political and institutional risk in Sub-Saharan Africa
title_sort relationship between fdi political and institutional risk in sub saharan africa
topic business
url http://hdl.handle.net/11427/35865
work_keys_str_mv AT matimazorodzai therelationshipbetweenfdipoliticalandinstitutionalriskinsubsaharanafrica
AT matimazorodzai relationshipbetweenfdipoliticalandinstitutionalriskinsubsaharanafrica