With the growing realization by governments of the beneficial effects of Foreign Direct Investment (FDI), barriers to FDI have been dropping but competition among countries for the limited pool of global capital, often through promotion and country branding, has intensified dramatically. The literature on FDI location choice is voluminous, but empirical findings are often contradictory and the factors studied are limited to tangible country characteristics without accounting for perceptual considerations. This study uses OLS regression to investigate the role of country branding in tandem with traditional country characteristics in the MENA region. The results show that the influence of country branding is significant and relevant implications are discussed.
Keywords: Country branding, country image, foreign direct investment, FDI location choice.