Monetary policy and foreign direct investment: Global evidence, 1970–2023

Key Points

• Monetary policy affects foreign direct investment flows, particularly in emerging markets.
• The analysis covers data from over 50 countries from 1970 to 2023, revealing trends in capital flows.
• Using macroeconomic models, this study examines the relationship between economic growth and foreign investment.
• Findings suggest targeted monetary policies could enhance investment flows, requiring careful consideration of economic contexts.