Regional policy of attracting foreign investment capital in the enterprise: an empirical analysis
Importance The article deals with the assessment of factors affecting foreign investment in regions and the identification of factors of regional policies that affect investment in enterprises. Objectives The aim of the study was to consider such regional factors as the level of regional economic development and the investment climate, industry development, geography, level of infrastructure (engineering of capital buildings, transport and social infrastructure), institutional environment, socio-political stability, and labor resources. Methods The methodology of research is the linear regression and the derivation of classification binary tree. As the empirical research base, we used the Russian companies' reporting for 2012 published on the official website of Bureau Van Dijk, including balance sheet, profit and loss statement indicators of enterprises, capital structure, number of employees, and the regional affiliation. Results We have calculated financial and economic characteristics of the enterprise: liquidity ratios, solvency, turnover, profitability and balance sheet data. The study found that the most significant factors are the characteristics of the enterprise: EBIT, cost of goods sold, and the amount of long term liabilities. We concluded that the investor first examines the financial condition of the enterprise, and then turns the attention to regional components. With regard to regional factors, the most significant ones are the industry focus, geographical factors, the quality of the labor force, the position in the rating of investment attractiveness of the constituent entities of the Russian Federation. An enabling institutional environment and socio-political stability, including assessment of corruption and ranking the Governors, were found to be insignificant.