Research by Megan Yuan Li that investigated the increasingly important role of national sentiment in foreign direct investment decisions was publicized in International Business Review (IBR) in 2019. Rated as 3 star according to ABS ranking list, IBR aims to foster the exchange of ideas on a range of important international subjects and to provide stimulus for research and the further development of international perspectives. “As international conflicts become more intense, national sentiment seems to be a prominent issue in the decision making of international business,” the authors noted. Abstract is copied below.

Studies of foreign direct investment (FDI) decisions typically assume that decision makers and stakeholders act rationally. Drawing on studies conducted at the individual level, this study focuses instead on affect and explores theoretically and empirically how national sentiment influences FDI decisions. In particular, we develop a typology for understanding national sentiment along two axes—positive versus negative and accumulated versus transient—and investigate their separate influences on FDI. The results indicate that negative sentiment has a greater influence on FDI than positive sentiment and that accumulated sentiment has a greater influence than transient sentiment. This study complements conventional FDI research by demonstrating that national sentiment offers additional explanatory power beyond the variables known to influence FDI decisions. Moreover, our study shows that research conducted at the individual level can be useful for understanding the influence of affective elements on FDI decisions.

If you are interested in the research, please read the paper

Megan Yuan Li, Shige, Makino, Chunyan Jiang. 2019. Does national sentiment affect foreign direct investment, an if so, how? Additional evidence. International Business Review, 28(5): 1-19. 

A full version of this article could be viewed at: 

https://www.sciencedirect.com/science/article/abs/pii/S0969593118305146?via%3Dihub