A proposed theoretical framework for the determinants factors for outward investments from emerging countries

Abstract

The purpose of the study presented here in the form of a theoretical essay was to identify determinants factors for outward foreign direct investments by companies headquartered in countries rated as emerging economies. A critical analysis was conducted on the UNCTAD database and a review of the Investment Development Path(IDP) Theory, fostering the integration of the findings of empirical studies related to direct investments in the most pertinent literature. The conclusion reached by this research underpins the suggestion of a theoretical framework with key factors that might push or pull outward investments from emerging countries. This framework is intended to boost the contributions of IDP Theory, suggesting determinants factors that are supplementary to the per capita GDP. With regard to the state of the art, this framework may provide guidelines for the internationalization strategies of firms in the emerging countries, as well as for steering government policies in these countries. Keywords: Outward investment. Emerging countries. IDP Theory. Foreign direct investment.