Assessment of Factors Affecting the Foreign Investment Attraction in Iran

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Abstract

Foreign investment is a critical development strategy. The aim of the study was to investigate the factors affecting the attraction of foreign investment in Iran. The statistical population included foreign investment companies covered by the Foreign Investment Promotion and Protection Act and some experts from investment licensing executive agencies in Tehran province. A total of 400 subjects were enrolled in 2014-2017. The data analysis was performed using Kolmogorov-Smirnov test. All foreign investment companies covered by the investment promotion and protection law were studied by sampling. In addition, a non-random sampling method was used at the experts’ level in the operating systems and executive organisations. In the present research, the Cochran formula was used to determine the sample size being 400 subjects. As a result, 550 questionnaires were distributed and completed; finally, 400 questionnaires were received and analysed in a correct and complete manner. Within the framework of the research, the parametric test (t-test) and linear regression were used for data analysis and the hypotheses due to normal distribution. After analysing the data collected from results of the respondents’ responses and based on mathematical and statistical models, the most important factors affecting foreign investment attraction were the economic factor (p<0.001) followed by the social factor (p=0.002), the administrative bureaucracy (p=0.003), cultural factor (p=0.021) and the agent of the state (p=0.031), all of which exhibited a significant relationship. Based on the results, the economic and cultural factors were the most effective parameters affecting foreign investment.

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