DO natural resources curse FDI in GCC countries?

الملخص EN

Natural resources are blessing for some countries to attract FDI but cursed for others.

Existence literature argue that resource-rich countries attract less FDI because of resource (oil) price volatility.

This study examines that natural resources discourage FDI in GCC countries (FDI-Natural resources curse hypothesis).

Using panel data analysis for six oil dependent countries during 1980-2013 and applying several econometrics techniques.

The main findings of this paper is that natural resources measured by oil rents have negative association with FDI inflows; this negative impact is robust even when other FDI determinates of FDI included.

FDI inflows decrease between 0.15 and 0.92% when oil rents increased by 1%.

In addition, the empirical results show that trade openness and labour force are the main factors that encourage FDI while political instability and corruption deter FDI inflows into GCC countries