Panoeconomicus 2015 Volume 62, Issue 1, Pages: 105-122
https://doi.org/10.2298/PAN1501105K
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The importance of corporate taxation for FDI attractiveness of southeast European countries
Kersan-Škabić Ines (Juraj Dobrila University of Pula, Faculty of Economics and Tourism “Dr. Mijo Mirković”, Pula, Croatia)
The aim of this paper is to research the determinants of FDI inflows in the
SEE region with a special emphasis on corporate tax rates. The panel data
analysis (GMM methodology) was conducted on six countries in the period
2000-2011 in two versions: as gravity model based on bilateral FDI inflows
and on the total FDI inflows (and inward stock). The results pointed the most
important determinants for attracting FDI in SEE countries are market size
(population), growth rates, GDP per capita, and wages. Institutional
variables and corporate tax rates were not significant in the analysis of
flows, but they become significant in the analysis of FDI inward stock.
Keywords: FDI, SEE, Corporate tax rates