Gibson D. Lewis
Center for Business Research and Economic Development
GEOGRAPHY MATTERS: KOHONEN CLASSIFICATION OF DETERMINANTS OF FOREIGN DIRECT INVESTMENT IN TRANSITION ECONOMIES
JOEL DEICHMANN
ABDOLREZA ESHGHI
DOMINIQUE HAUGHTON
SELIN SAYEK
NICHOLAS TEEBAGY
HEIKKI TOPI
Abstract
This exploratory study examines the extent to which non-spatial determinants of foreign direct investment (FDI) organize themselves in a manner that mimics the spatial proximity of twenty-five Eurasian transition economies. The Kohonen algorithm is used to create a self-organizing map (SOMs) of a data set that features vectors of twenty-~e socioeconomic variables. In this analysis, clusters emerge among the Central European, Balkan, Baltic, and Caucasus/Central Asian regions, leaving Russia asa regional outlie1: By introducing SOMs to the discussion of FDI and the factors governing its distribution, we demonstrate an untapped utility in the visualization and analysis of economic data.
Gibson D. Lewis
Center For Business and
Economic Development
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