An Analysis of the Location Determinants of Foreign Direct Investment: The Case of Serbia

Abstract

The existence of large differences in the distribution of foreign direct investment (FDI) inflows at the national, regional and the level of the global economy has initiated numerous studies on the determinants of its location. Despite the fact that the analysis of the FDI location determinants has an important place in the framework of the existing literature on FDI, insufficiently enquired problem of the FDI location determinants in the Serbian economy has inspired and determined the contents of this paper. The aim of this paper is to, based on comprehensive analysis of the FDI location determinants, indicate the importance of those location specific determinants that play a key role in encouraging FDI inflows in the Serbian economy in the transition. The initial basis for making conclusions will include the available original documents, various reports, studies, statistical records and other primary and secondary data sources. By identifying the key FDI location determinants the intention is to give some recommendations about the possible directions for the improvements of the current investment environment in order to attract greater and sustainable flows of FDI as essential ingredient for the future growth and development of the Serbian economy.