Abstract
State investment incentives are detrimental to the quality of the business environment and create unequal starting conditions for entrepreneurs to implement investment plans. In some cases, however, it is necessary to regulate the allocation of inward investment to regions within one country and thus decrease the disparities. Investment incentives are instruments that in general might violate market principles and thus are regulated within the EU internal market. Despite being aware of this fact most economists and politicians advocate these kinds of measures as necessary and relatively cheap in order to push the economy forward or win international big private equity investments. Investment aid is regional aid to stimulate investment in disadvantaged regions and to create new jobs in the Slovak Republic. Beneficiaries of this assistance may be natural and legal persons authorized to carry on business in the territory of the Slovak Republic and whose investment activities and projects meet the conditions of Act no. 561/2007 Z.z. on Investment Assistance and on Amendments to Certain Acts. This paper will focus on how investment incentive attracts foreign investment in the Slovak Republic and based on the data from 2002 to 2017 we will analyze their effectiveness on the created jobs. Despite the possible support from the Slovak government not all foreign investors areapplying for investment incentives, either are in contact with the government during their investment phase.
Highlights
Foreign investment is a recognized element in the economy of the state, serving on the one hand to reduce unemployment and, on the other hand, playing an important role in the inflow of the vast amount of capital it spends in the interests of state welfare, often presented primarily for the benefit of the public and for the citizens
If there is a rapid influx of Foreign Direct Investment (FDI) in the country, it means that the business environment represents a healthier rate of return on investment and labor productivity is higher than in other countries
The paper is structured into integral parts dealing with development of FDI in Slovak republic and investment incentives based on current data, their mutual comparison and their relationship with the concluded conclusion
Summary
Foreign investment is a recognized element in the economy of the state, serving on the one hand to reduce unemployment and, on the other hand, playing an important role in the inflow of the vast amount of capital it spends in the interests of state welfare, often presented primarily for the benefit of the public and for the citizens. FDI has been and continues to be an important factor in the development of transition countries They help create new jobs, which can lead to an influx of new technologies, and in total they provide the necessary capital to restore a successful transition to the market economy. Other authors (e.g. Dudáš 2004, 2010; Fabuš 2010, 2011, 2012, 2014; Korauš et al 2018; Tvaronavičienė, 2018) deal with individual factors and their impact on economic development, respectively economic growth, and motivation of investors, economic and political conditions created in a host country. Hymer (1976) is concerned with why companies transfer intermediate products (knowledge, technologies, etc.) among countries He opines that FDI can be clarified by foreign control. The paper is structured into integral parts dealing with development of FDI in Slovak republic and investment incentives based on current data, their mutual comparison and their relationship with the concluded conclusion
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
