The Analysis of the Effects of Institutional Factors on the Investment in Selected OPEC-Member Countries

In recent decade, it has been universally agreed by the economists that the institutions are the most influential factors affecting the economic growth and investment in selected Countries. The present study aimed to examine the impact of these institutions on investment OPEC-member countries by the use of panel-data-based regression from 2002-2015. To do so, the following indices are used: law and order and preservation of the property rights functioned as the market-creating institutions, the control and regulations in the labor market functioned as the regulating institutions, accessibility to the sound money functioned as the market-stabilizing institutions and democratic accountabilities functioned as the market-legitimizing institutions. The results suggested that the regulating and the market-stabilizing institutions in OPEC-member countries can be influential in the investment, but the market-stabilizing and the legitimizing institutions are not significant and produce no impact on the investment. In other words, it is essential to strengthen the legitimizing and stabilizing institutions for a better investment function.