FDI in the EU: Does the Country of Origin Really Matter?

European Union countries have experienced a substantial increase in inflows of foreign direct investment (FDI) in recent years. Nevertheless, there has been little empirical research investigating the impact of FDI coming from different source countries. This paper explores and determines what mix of investment is more growth enhancing for core EU countries.  By providing empirical evidence that country of origin does matter, this study addresses the economic issue following recruiting war between EU member states for FDI inflows. This research finds a negative relationship between economic growth and differences in capital and labor endowments of the economies, as well as between knowledge transfer and distances between the source and the host countries.