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International business research and risky investments, an analysis of FDI in conflict zones

Driffield, NL, Jones, C and Crotty, J 2012, 'International business research and risky investments, an analysis of FDI in conflict zones' , International Business Review . (In Press)

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Abstract

The purpose of this paper is to examine the determinants of a firm’s strategy to invest in a conflict location. To the best of our knowledge, this has not been done before. We examine this using a standard model of international business, overlaid with the fundamental approach to corporate social responsibility. We start with the population of multinationals who have chosen to invest in low income countries with weak institutions. We then split this sample in order to distinguish between firms that have invested in conflict regions compared to those that haven’t. Our analysis then proceeds to explain the decision of those firms to invest in conflict locations by using a simple Probit model. We find that countries with weaker institutions and less concern about corporate social responsibility (CSR) are more likely to invest in conflict regions. Finally, firms with more concentrated ownership are more likely to invest in such locations.

Item Type: Article
Themes: Subjects outside of the University Themes
Schools: ?? sch_sbs ??
Journal or Publication Title: International Business Review
Publisher: Elsevier
Refereed: Yes
ISSN: 0969-5931
Depositing User: Users 29196 not found.
Date Deposited: 08 Dec 2011 17:31
Last Modified: 03 Jul 2014 10:48
URI: http://usir.salford.ac.uk/id/eprint/19129

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