How attractive are Italian regions for foreign investment? Methodological Approach

The general benefits of attracting FDI, HR and firms are commonly recognized by policy makers and analysts. Although it may seem natural to argue that most regions would like to attract FDI investment because it creates jobs, transfers technology and leads to more trade, existent literature lacks in supplying both an exhaustive explanation concerning factors of FDI attractiveness and a suitable measure of it. So, by means of literature, this paper aims at individuating main determinants making a region catching up and at creating an innovative index of FDI attractiveness, throughout an adaption of existing indices and an extension by several experts opinion; successively we apply it to Italian regions for comparative purposes. We found that foreign investors are likely to invest in regions with high immaterial determinants like human resource capability, resource endowment and market opportunities. Finally, we outline advantages this model can bring, further applications and relative limits.