The impact of good governance of foreign direct investment inflows: a study on the South Asia region

namely, Voice and Accountability (VA) and Government Effectiveness (GE) have significant impact on the FDI inflow in the South Asian region. The other four variables, Control of Corruption (CC), Political stability and absence of violence (PV), Regulatory Quality (RQ), and Rule of Law (RL) have a negative impact on FDI inflow indicating that these factors do not influence the attraction of FDI inflow. Therefore we concluded that improved good governance of Voice and Accountability (VA) and Government Effectiveness (GE) will increase FDI inflows. Also policy makers and enforcement agencies must ensure relevant and effective strategies were formulated and implemented to enhance government effectiveness where time taken to start business and approval of documents are shorten to facilitate more FDI in future. Future studies should consider more countries could be taken into consideration. Also a comparative study could be done to confirm the role of Good Governance on attracting FDI