Determinants of Foreign Direct Investment in Bolivia. An institutional approach

Abstract

This paper was proposed to analyse the determinants of foreign direct investment (FDI) in Bolivia, in its two periods of insertion, that correspond to two opposed paradigms that, with their peculiarities, have managed to attract significant capital flow to mainly extractive activities. For this purpose, the approach applied to the investigation corresponds to that of the neo-institutionalist school, which allows to elucidate the effect of the institutions on the behaviour of the FDI in the sectors of the national economy, using panel data techniques. The results show that institutions of the “market maker” type have only been relevant for attracting foreign capital to the exporting primary sector, while the other types of institutions play a predominant role for FDI