Study on factors having impact on foreign direct investment attraction

Abstract

Investment has a significant impact on the world’s economy and the level of countries’ development. Foreign direct investments (FDI) stimulate a country’s GDP growth, increasing of an export level, business development. Investments bring not only yield but also contribute to the country’s economic growth, which is necessary for goods and services expansion, administration and consumption. In aligning with foreign direct investments new business ideas arise, the productivity of the existing and emerging markets increase. Hence, the aim of the present study is to indicate the factors influencing the amount of foreign direct investments into Lithuania. The following factors were investigated: GDP, inflation rate, trade openness, tourism, the level of residents’ education. In order to reach the aim, the following tasks were raised: to conduct scientific literature investigating FDI review and justify the identified factors. For the research, the following methods were chosen: scientific literature review, correlation and regression analysis. The study outcomes revealed that FDI attraction is affected by GDP and education level.