1. Determinants of Foreign Direct Investment in Developing Countries Cynthia Ortega, Jamie Haime, Francesca Ioffreda, Kyle Ragins

2. Factors Considered Population Population Labor Force Labor Force Literacy Rates (Education) Literacy Rates (Education) GDP Growth Rate GDP Growth Rate Unemployment Rate Unemployment Rate Inflation Rate Inflation Rate External Debt (Risk) External Debt (Risk) Internet Users (Tech) Internet Users (Tech) Freedom Index (Openness) Freedom Index (Openness) Percent of paved roads (Infrastructure) Percent of paved roads (Infrastructure) Dependent Variable (Y) FDI flows

3. The Data Set

5. Summary Statistics

7. Regression Analysis

8. Model Y(FDI) = -29.74 + 0.83(POP) + 2.20(EDU) - 2.26(UNEMP) + 4.30(INFL) + 0.24(RISK) + 0.11(TECH) + 4.29(OPEN) 7 X Variables -- all statistically significant Inflation and Risk opposite expected signs

9. Multicollinearity PopulationEducationUnemploymentInflationRiskTechnologyOpenness Population1 Education0.0204400891 Unemployment-0.010013954-0.4001432771 Inflation0.0378527950.1218753330.006749911 Risk0.3818990720.40669205-0.360606664-0.1809006411 Technology0.169275035-0.3793753670.490140539-0.208141981-0.2642858821 Openness-0.1337773920.219827196-0.225659663-0.3127462760.130484842 0.01933454 41

10. Heterskedasticity Park test resulted in the following p- values Park test resulted in the following p- values POP 0.2498808 EDU 0.1363154 UNEMP 0.3257653 INFL 0.3493559 RISK 0.6372357 TECH 0.4558863 OPEN 0.8573450

11. Conclusions Significant correlations with between FDI and the following variables Significant correlations with between FDI and the following variables PopulationPopulation Literacy RatesLiteracy Rates Unemployment RateUnemployment Rate Inflation RateInflation Rate External Debt (Risk)External Debt (Risk) Internet Users (Tech)Internet Users (Tech) Freedom Index (Openness)Freedom Index (Openness) Can’t make a statement about causality, especially with inflation and risk, as signs are opposite expected Can’t make a statement about causality, especially with inflation and risk, as signs are opposite expected Future analysis might concentrate on developing an effective model for FDI per capita and going beyond linear regressions towards more complex relationships Future analysis might concentrate on developing an effective model for FDI per capita and going beyond linear regressions towards more complex relationships