JOINT EFFECT OF NATIONAL IMAGE, BUSINESS CLIMATE,   AND TECHNOLOGY TRANSFER TO FOREIGN DIRECT INVESTMENT IN SUB-SAHARAN AFRICA

Yuwei Chen; Bitange Ndemo; Martin Ogutu; XN Iraki

Yuwei Chen
Bitange Ndemo
Martin Ogutu
XN Iraki

Abstract

The main purpose of this study was to establish the joint effect of national image,business climate, and technology transfer on foreign direct investment (FDI) among Sub-Saharan African nations. The investigation was based on the positivism approach, where a descriptive cross-sectional design was adopted. The study targeted all the 46 Sub-Saharan Africa (SSA) countries, and a census approach was employed to study all
the SSA countries. Both primary and secondary sources of data were used in the study. A structured research questionnaire was used in collecting primary data, where a survey questionnaire was administered to the Heads of Foreign Missions of each of the 46 SSA countries in Kenya. The United Nations Conference on Trade and Development (UNCTAD) publications were used as the secondary sources of data. Data were then
analyzed using both descriptive and inferential statistics. The R square indicated that the overall model explained 89.4% of changes in FDI. The overall model was also statistically significant (F= 95.709, p-value< .05). The influence of individual variables was statistically significant for business climate (β = 1.240, p-value< .05) and technology transfer (β = .540, p-value< .05) and not statistically significant for national image
(β= .282, p-value> .05). Thus, the unique contribution of this study to theory is that national image, business climate, and technology transfer influenced FDI. This study has confirmed the contributions of various theories, including Soft Power Theory, Monopolistic Advantage Theory, and the Technology Gap Theory. The findings of this study will be a guide to policymakers to develop strategies, promotion of business climate, and technology transfers that are appropriate to the countries in Sub-Saharan Africa in order to enhance their FDI flows.

Keywords: National Image, Business Climate, Technology Transfer, FDI, International
Business