Studying the Impact of Corruption Perception Index on Foreign Direct Investment in MENA Countries

In this paper, an attempt is made to investigate de facto the impact of Corruption Perception Index on the Foreign Direct Investment (FDI) in MENA countries during the period of 2003-2014. To accomplish this task, I have designed an empirical model and estimated it viz-a-viz utilizing the Dynamic Panel Data Approach and General Method of Movement (GMM Estimator), in toto. The results prima facie, indicate that the corruption variable has negative but significant relation with FDI, while the other explanatory variables such as real interest rate, trade openness and per capita GDP have positive and significant effects on FDI, Sine qua non.
Thus, the main policy implication of this paper denotes that the policy makers of these countries and specifically Iran should execute the anti-corruption rules and programs and via ensuring the security of investment, could pave the way to absorb FDI, Ipso facto.