Transformations  in
Business & Economics

Idiosyncrasy of the Investment Development Path: The Case of Romania
Maria Birsan, Anuta Buiga, Simona Gabriela Masca

ABSTRACT. This paper deals with IDP (Investment Development Path) in the case of Romania. The aim was to test the validity of the IDP theory, and to find out the specificities in this particular case. Our investigation was based on the two approaches of the IDP concept: the initial concept of IDP, which relates the NOIP (Net Outward Investment Position) to the level of development proxy by GDP/capita; the revised concept of IDP (broadened approach), which complement the narrow understanding of the level of development by including several structural variables. Empirical testing shows that GDP/cap does not influence NOIP.

Concerning the impact of several structural variables on IFDI (Inward FDI) and on OFDI (Outward FDI), the results enforce the finding regarding the lack of impact of GDP/cap on IFDI or on OFDI. But the structural variables influence positively or/and negatively the NOIP evolution. Both empirical testing have confirmed the idiosyncrasy of IDP in the case of Romania.

KEYWORDS: FDI, Investment Development Path, transition economy, Romania.

JEL classification: F21, O52, F23, P2.