Determinant of FDI inflow from Asian Economies to Lao PDR

FDI inflow plays an essential role in economic growth in any countries. Thus FDI inflow and its impact on economic growth deserve attention in the economics literatures. This article intends to analyses the main determinant of FDI inflow from some Asian countries that contributed a high value of investment in Lao PDR. The static and dynamic gravity models were applied to panel data over 1995-2015 time periods. The findings conclude that the natural resource (hydropower, mining), FDI in the previous year, market size (home countries), inflation rate, infrastructure, and WTO have the positive impact on FDI inflow. While real exchange rate, trade openness, ASEAN, distance, and crisis are not the critical determinant to attract FDI from Asian countries.