Business environment and foreign direct investments: the case of selected European emerging economies

Abstract The globalisation process of the world economy has led to increase of international capital mobility. In the last two decades, the level of foreign direct investments (F.D.I.) was significantly raised and in 2017 was US$1.8 trillion. The question occupying attention in economic literature is what the main motives and determinants of F.D.I. in certain countries are. This article aims to explore what are the linkages between business environment and inward F.D.I. The research was performed on the sample of five European emerging economies, located in Central and Eastern Europe (C.E.E.) – Poland, Slovenia, Bulgaria, Romania and Serbia. The research compared the main tendencies of F.D.I.s in selected economies, institutional framework and reforms during transition process, competitiveness and ease of doing business (E.D.B.). With the quantitative analysis and ordinary least squares (O.L.S.) regression authors tried to identify statistical significant linkages between inward F.D.I. and ease of doing business indicators, where control variables were G.C.I. pillars (relevant for business regulation and institutional framework), macroeconomic performances, market capitalisation and taxation. The results are identified factors of business environment relevant for attraction of F.D.I. and provided empirical model for each country respectively