Foreign direct investment and European monetary integration

The aim of this paper is to construct and test a model explaining the inward FDI position of all European Monetary Union countries on the basis of their location advantages during 1980-2010 period. The model consists of variables approximating location advantages as these are suggested by economic theory and empirical research. The paper also investigates the impact of European monetary integration on FDI inflows. For this reason the countries under examination are separated in two groups: Core counties and periphery countries. The focus is on the potential different impact of the euro adoption, among these groups, in terms of attracted FDI inflows.