As the most active foreign direct investment (FDI) participating country in the world, the U.S. had a total of $246 billion FDI inflow and $125 billion FDI outflow in 2019. According to the World Inve..
As the most active foreign direct investment (FDI) participating country in the world, the U.S. had a total of $246 billion FDI inflow and $125 billion FDI outflow in 2019. According to the World Investment Report (2020) by the United Nation Conference on Trade and Development (UNCTD), the U.S. is the largest recipient of inflow FDI and the 2nd largest sourcing country for outflow FDI activities in the world. In this project, we will investigate the outbound FDI activities of the U.S. in other countries around the world and analyze the role played by cultural similarities/differences between the U.S. and the investment destination countries in attracting or deterring the FDI from the U.S. We will follow Geert Hofstede’s cultural dimensions framework and Inglehart-Welzel's cultural values framework to measure cultural characteristics of various countries in the world. The impacts of cultural distance between the U.S. and the investment destination countries will be estimated while controlling for other social and economic factors such as economic development, population size, open trade policy, and overall global competitiveness of the FDI destination countries.
