Foreign direct investment in Europe: Is there redirection from the South to the East?

This paper examines patterns of Foreign Direct Investment (FDI) in two regions on the periphery of Europe, namely, the Central and Eastern European countries (CEECs) and the countries of Southern Europe. We investigate FDI redirection from Southern Europe to the CEECs. Using gravity model equations, we compare expected and actual FDI figures. We ultimately conclude that there is no evidence of FDI redirection between these two regions. (C) 2003 Association for Comparative Economic Studies. Published by Elsevier Science (USA). All rights reserved.