An Exploratory Factor Analysis of the Location -Specific Antecedents to Foreign Direct Investment in Post- Crisis Zimbabwe (2009 - 2015)
Keywords:
Location -specific antecedents; foreign direct investment; behavioural finance; investment market entry decisions; Zimbabwe
Abstract
While there are a plethora of studies based on the generic determinants of foreign direct investment, there is a discernible dearth of research into location - specific antecedents of distinct foreign direct investment typologies. This paper identifies the location- specific antecedents influencing foreign investors considering exploiting international business opportunities in post- crisis Zimbabwe. The literature provided the bases for the propositions advanced by this paper. Quantitative survey data was generated from a purposive sample of n=305 foreign investors. An exploratory factor analysis was conducted. The findings suggest that post- crisis Zimbabwe possesses the location- specific antecedents required by market- , resource - , efficiency-, and strategic asset- seeking FDI inflow. It is recommended that Zimbabwean policy- makers take cognisance of these nuances and implement appropriate market entry strategies to lure investors to Zimbabwe to grow the post- crisis economy.
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References
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Ajayi, S. I. (2006) . Foreign direct investment in Sub - Saharan Africa: Origins, targets, impact and potential. [Online] Available at: http://www.dspace.africaportal.org/jspui/bitstream/.../3/FDI _papers_booklength_volume.pdf.[Accessed 3 November 2017]. Akpansung, O. A. (2013). Motives and determinants of foreign investors: A survey of literature. European Journal of Humanities and Social Sciences, 28(1), 1476- 1490. Anyanwu, J. C. & Yameogo, N. D. (2015). Regional comparison of foreign direct investment to Africa: Emprirical analysis. Africa Development Review, 27(4), 345 - 363. Bertelsmann Stiftung's Transformation Index. (2014) .Zimbabwe country report. [Online] Available at: http://www.btiproject.org/fileadmin/files/BTI/.../Reports /2014/pdf/BTI_2014_Zimbabwe.pdf[Accessed 7 November 2017]. Browning, C. S. (2016). Nation branding and development: Poverty panacea or business as usual?Journal of International Relations and Development, 19, 50 - 75. Chinamasa, P. A. (2014) . The 2015 Zimbabwe national budget statement. [Online] Available at: http://www.zimtreasury.gov.zw/budget-policy- statements?download=212:2015 national -budget. [Accessed 7 November 2017]. Chiumbu, S. & Musemwa, M. (2005) . Introduction: Perspectives of the ZImbabwe crisis. In crisis! What crisis? [Online] Available at: http://www.hsrcpress.ac.za/downloadpdf.php?... files%2FPDF%2F2295%2FCrisis...Crisis!%20. [Accessed 10 April 2018]. Costello, A. B. & Osborne, J. W. (2005). Exploratory factor analaysis: Four recommendations for getting the most from your analysis. Practical Assessment, Research and Evaluation, 10(7), 1 - 9. Cui, L., Meyer, K. E. & Hu, H. W. (2014). What drives enterprises'intent to seek startegic assets by foreign direct investment? A study of emerging. Journal of World Business, 49, 488 - 501. Danha, D., Takaindisa, J., Mlotshwa, L. & Simlet, C. (2015) . Zimbabwe equity strategy 2015: At a crossroads. [Online] Available at: http://263chat.com/wp - content/uploads/ 2015/02/IH - Zimbabwe - EquityStrategy- 2015.pdf. [Accessed 2 November 2017]. De Vries, A., Erasmus, P. D. & Gerber, C.(2017). The familiar versus the unfamiliar: Familiarity bias amongst individual investors. Acta Commercii, 17(1), 1 - 10. Delloite . (2012) . Investing in Zimbabwe. [Online] Available at: http://www2.deloitte.com/.../Deloitte/au/.../ deloitte - au - aas - doing- business - zimbabwe - 13.pdf [Accessed 2 November 2017]. Du, M. & Boateng, A.(2015). State ownership, institutional effects and value creation in cross -border mergers and acquisitions by Chinese firms. International Business Review, 24, 430 - 442. Dunning, J. H.(2000). The eclectic paradigm as an envelope for economic and business theories of MNC activity. International Business Review, 9, 163 - 190. Dupasquier, C. & Osakwe, P. N.(2005) . Foreign direct investment in Africa: Performance, challenges and responsibilities. [Online] Available at: http://www.economia.uniroma2.it/Public/YICGG/file /readinglist/3/3_Africa_FDIs.pdf. [Accessed 2 November 2017]. Eden, I. & Dai, L.(2010). Rethinking the O in Dunning's OLI/Eclectic paradigm. Multinational Business Review, 18(2), 13 - 34. Etim, N. S., Onyebuchi, O.& Udo, N. C.(2014). The determinants of foreign direct investment and their impacts on the Nigerian economy (1975 - 2010). Journal of Integrative Humanism - Ghana, 3, 74 - 84. Festervand, T. A.(2011). Perceptions of select, newly established states of the former Soviet Union as foreign direct investment options: A longitudinal perspective. International Business and Economics Research Journal, 10(6), 9 - 20. Field, A. P.(2009) . Discovering statistics using SPSS for windows: Advanced techniques for all users. London: Sage Publications Inc. George, D. & Mallery, P.(2003) . SPSS for Windos step by step: A simple guide and reference, 11.0 update. 4th ed. Boston: Allyn & Bacon. Georgopoulos, G. J.(2008). Cross border mergers and acquisitions: Does exchange rate matter? Some evidence for Canada. Canadian Journal of Economics, 41(2), 450 - 474. Hailu, Z. A.(2010). Demand side factors affecting the inflow of foreign direct investment to African countries: Does capital market matter?. International Journal of Business and Management, 5(5), 104- 116. Hair, J. F., Black, W, C., Babin, J. B., Anderson, R. E. & Tatham, R. L.(2006) . Multivariate data analysis. 6th ed. Upper Saddle River: Pearson Prentice Hall. Jain, N. K., Kundu, S. K. & Newbury, W.(2015). Efficiency seeking emerging market firms: Resources and location choices. Thunderbird International Journal, 57(1), 33 - 50.
Kariuki, C.(2015). The determinants of foreign direct investment in the African Union. Journal of Economics, Business and Management, 3(3), 346- 351. Kharwish, H. A. & Siam, W. Z.(2010). Determinants of foreign direct investment: Evidence from Jordan. Business and Economics Horizons, 2, 67 - 75. KPMG.(2012) . Investing in Zimbabwe. [Online] Available at: https://www.kpmg.com/Africa/ en/KPMG - in -Africa/Documents/Zimbabwe.pdf. [Accessed 7 November 2017]. Kramarenko, V., Engstrom, L., Verider, G., Fernandez, G., Oppers, S. E., Huges, R., McHugh, J. & Coatts, W.(2010) . Zimbabwe: Challenges and policy options after hyperinflation, Washington D.C: International Monetary Fund. Krejcie, R. V. & Morgan, D. W.(1970). Determining sample size for research activities. Educational and Psychological Measurement, 30, 607 - 610. Larsen, R. & Warne, R. T.(2010). Estimating confidence intervals for eigenvalues in exploratory factor analysis. Behaviour Research Methods, 30, 871 - 876. Lintunen, J.(2010) . Motives and location factors of Chinese outward FDI in a small developed country. Helsinki: Aalto University. Mabule, B.(2012) . The determinants of foreign direct investment on the South African economy growth. Mafikeng: North West University. Mahembe, E. & Odhiambo, N. M.(2013). The dynamics of foreign direct investment in SADC countries: Experiences from 5 middle- income countries. Problems and Perspectives in Management, 11(4), 35 45. Moghaddam, K., Sethi, D., Weber, T. & Wu, J. (2014). The smirk of emerging market firms: A modification of the Dunning's typology of internationalisation motivations. Journal of International Management, 20(3), 359 - 374. Monyau, M. M. & Bandara, A.(2014) . Zimbabwe. African economic outlook. [Online] Available at: http://www.africaneconomicoutlook.org/fileadmin/uploads/aeo/2014 /PDF/CN_Long_EN/Zimbabwe.pdf. [Accessed 7 November 2017]. Muneer, S., Butt, B. Z. & Rehman, K. U. (2011) . A Multifactor Model of Banking Industry Stock Returns: An Emerging Market Perspective. Information Management and Business Review, 2(6), 267- 275 Musila, J. W. & Sigue, S. P.(2006). Accelerating foreign direct investment to Africa from policy statement to successflu strategies. Journal of Managerial Finance, 32(7), 577- 593. Norris, M. & Lecavalier, L.(2010). Evaluating the use of exploratory analysis in developmental disability psychological research. Journal of Autism and Development Disorders, 40(1), 8 - 20. Oyin, O. (2014) .The effect of foreign direct investment: Case study Nigeria, Oulu: University of Oulu. Reio, T. G. & Shuck, B.(2015). Exploratory factor analysis: Implications for theory, research and practice. Advances in Developing Human Resources, 17(1), 12 - 25. Schwab, K.(2014) . The global competitiveness report 2014 - 2015. World Economic Forum. [Online] Available at: http://www3.weforum.org/docs/WEF_GlobalCompetitivenessReport_2014 - 15.pdf. [Accessed 7 November 2017]. Sena, S.(2012) . Nation branding: Case study of Zimbabwe, Port Elizabeth: Nelson Mandela Metropolitan University. Sikharulidze, D. & Kikutadze, V.(2013). Location advantage and Georgia's potential to attract foreign direct investment. European Scientific Journal, 1, 101 - 105. Simelyte, A., Peleckis, K. & Pelekine, V.(2015). Regualtion and promotion of foreign direct investment in Baltic States. American Journal of Contemporary Research, 5(5), 194 - 202. Sue, V. M. & Ritter, L. A.(2007) . Conducting online surveys. London: Sage. Toepoel, V.(2016) . Doing surveys online. London: Sage Publications Limited. Bertelsmann Stiftung's Transformation Index.(2014) . Zimbabwe country report. [Online] Available at: http://www.btiproject.org/fileadmin/files/BTI/.../Reports/2014/pdf/BTI_2014_Zimbabwe.pdf[Acc essed 2 November 2017]. Udo, E. A. & Obiora, I. K.(2006) . Determinants of foreign direct investment and economic growth in the West African Monetary Zone: A system equations approach. [Online] Available at: https://www.gtap.agecon.purdue.edu/resources/download/2547.pdf. [Accessed 7 November 2017].
United States Department of State.(2014) . Investment climate statement: Zimbabwe. [Online] Available at: http://www.state.gov/documents/organization/229325.pdf. [Accessed 7 November 2017]. Vijayakumar, N., Sridharan, P. & Rao, K. C. S.(2010). Determinants of foreign direct investment in BRICS countries: A panel analysis. International Journal of Business Science and Applied Management, 5(3), 1 - 13. Williams, B., Brown, T. & Onsman, A.(2010). Exploratory factor analysis: A five step guide for novices. Australasian Journal of Paramedicine, 8(3), 1 - 20. Wilson, R. T., Baack, D. & Baack, W.(2014). Foreign direct investment promotion:Using advertising to change attitudes and behaviours. The Marketing Management Journal, 24(2), 108 - 123. World Bank Group.(2014) . Zimbabwe: The World Bank Group country survey. [Online] Available at: http://documents.worldbank.org/curated/en/2015/04/24 434353/zimbabwe-world bank- group - country- survey- fy- 2014 - report-findings. [Accessed 7 November 2017]. Yong, A. G. & Pearce, S.(2013). A beginner's guide to factor analysis: Doing an exploratory factor analysis. Tutorials in Quantitative Methods, 9(2), 79 - 94. Zimbabawe Agenda for Sustainable Socio - Economic Transformation.(2013) . ZIMASSET 2013 - 2018. [Online] Available at: http://www.herald.co.zw/wp- content/uploads/2014/01/Zim-Asset.pdf. [Accessed 7 November 2017]. Zimbabwe Investment Authority.(2015) . Annual Report 2015. [Online] Available at: http://www.investzim.com [Accessed 7 November 2017].
Published
2018-07-19
How to Cite
Matiza, T., & Perks, S. (2018). An Exploratory Factor Analysis of the Location -Specific Antecedents to Foreign Direct Investment in Post- Crisis Zimbabwe (2009 - 2015). Journal of Economics and Behavioral Studies, 10(3(J), 111-121. https://doi.org/10.22610/jebs.v10i3.2321
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Research Paper
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