The attractiveness of countries for FDI. A fuzzy approach

This paper presents a new method for measuring the attractiveness of countries for FDI.
A ranking is built using a fuzzy expert system whereby the function producing the final evaluation is
not necessarily linear and the weights of the variables, usually defined numerically, are replaced by
linguistic rules. More precisely, weights derive from expert opinions and from econometric tests on
the determinants of countries’ FDI. As a second step, the view-point of investors from two different
investing economies, the UK and Italy, are taken into account. Country-specific factors, such as the
geographic, cultural and institutional distances existing between the investing and the partner
economies are included in the analysis. This shows how the base ranking changes with the
investor’s perspective.