Infrastructure quality, firm characteristics and foreign ownership in Africa: Evidence from firm level manufacturing data

Abstract

The primary objective of this study was to examine the role played by the quality of infrastructure and firm heterogeneity on the amount and probability of being foreign invested using maximum likelihood techniques like the Probit and Tobit models. Results show that firm size and skilled labour have a positive and significant effect in attracting FDI, whilst firm age, unionisation and power outages have a negative and significant effect. Water problems do not matter much in attracting foreign investors.