Macroeconomic Determinants of Foreign Direct Investment Inflow in Thailand
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Abstract
Macroeconomic determinants of foreign direct investment enhance the economic growth and industrial development dramatically. Therefore, determining policies and measures to increase competitive potentials and attract foreign direct investment should be oriented properly and effectively. Hence, this research aimed to investigate an effect of macroeconomic determinants from foreign direct investment inflows in Thailand, which included 10 countries with the highest investment in Thailand in 2018. The secondary data were panel data including time series data with cross section data the yearly data started 2009-2018, a total of 100 observations. The data of this study were analyzed by using random effect model. The results showed the effect of macroeconomic determinants on foreign direct investment inflows in Thailand such as the average rate of wage, trade, inflation and socio-political instability (SPI) except GDP growth rate in the previous year and exchange rate had no significance on foreign direct investment inflows in Thailand with the statistical significance of 0.05 level. The relationship in the positive sign of independent factors to foreign direct investment inflows such as the average rate of wage and inflation whereas the trade and socio-political instability (SPI) had negative relationship with the foreign direct investment inflows.
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