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Article

European FDI in Ireland and Iceland: Before and after the Financial Crisis

1
Faculty of Business Administration, University of Akureyri, Borgum, Norðurslóð 2, 600 Akureyri, Iceland
2
Faculty of Political Science, University of Iceland, 102 Reykjavík, Iceland
*
Author to whom correspondence should be addressed.
J. Risk Financial Manag. 2021, 14(1), 23; https://doi.org/10.3390/jrfm14010023
Received: 9 November 2020 / Revised: 15 December 2020 / Accepted: 25 December 2020 / Published: 6 January 2021
This paper analyses Foreign Direct Investment (FDI) investment in Ireland and Iceland from other European countries during two periods, i.e., the pre-financial crisis period of 2000–2007 and the financial crisis period of 2008–2010. The aim of this research is to determine what made the countries interesting to foreign investors in both good and bad times; and, secondly, to examine whether European Union membership (and the Euro) made a difference in this respect. The results were obtained by using data from the OECD, the World bank, and other sources. The model constructed for the study applies the inverse hyperbolic sine transformation of the gravity model, which is a novel approach. The results demonstrate that before the financial crisis of 2008, European Union (EU) membership did not help Ireland attract more FDI from other EU countries. However, once it had been hit by the crisis, Ireland attracted more FDI from other EU countries. Iceland, on the other hand, which is not an EU country, attracted FDI from non-EU countries rather than from EU countries before the financial crisis. After the crisis, however, the origin within Europe, of FDI in Iceland had no significant effect on the flow of FDI into the country. View Full-Text
Keywords: European Union (EU); Foreign Direct Investment FDI; Trade Blocs; EFTA; International Monetary Fund (IMF) European Union (EU); Foreign Direct Investment FDI; Trade Blocs; EFTA; International Monetary Fund (IMF)
MDPI and ACS Style

Kristjánsdóttir, H.; Óskarsdóttir, S. European FDI in Ireland and Iceland: Before and after the Financial Crisis. J. Risk Financial Manag. 2021, 14, 23. https://doi.org/10.3390/jrfm14010023

AMA Style

Kristjánsdóttir H, Óskarsdóttir S. European FDI in Ireland and Iceland: Before and after the Financial Crisis. Journal of Risk and Financial Management. 2021; 14(1):23. https://doi.org/10.3390/jrfm14010023

Chicago/Turabian Style

Kristjánsdóttir, Helga, and Stefanía Óskarsdóttir. 2021. "European FDI in Ireland and Iceland: Before and after the Financial Crisis" Journal of Risk and Financial Management 14, no. 1: 23. https://doi.org/10.3390/jrfm14010023

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