600 International Organization TABLE 2.The economic and political determinants of FDI (cross-section) Variables Model I Model 2 Model 3 Model 4 MARKET SIZE 0.200 0.183 0.268* 0.259 (1.463) (1.198) (1.705) (1.629) DEVELOPMENT LEVEL 0.088 -0.124 -0.358 -0.336 (0.351) (-0.340) (-0.945) (-0.874) GROWTH -0.2857** -0.266* 一0.321** -0.317** (-2.857) (-2.465) (-3.243) (-3.176) TRADE 0.030** 0.031** 0.034*** 0.034*** (7.151) (6.673) (10.048) 8.883) NATURAL RESOURCES 6.623*** 6.365*** 5.217*** 5.234*** (3.114) (2.792) (2.701) (2.731) GOVERNMENT CONSUMPTION -0.076* 一0.091** -0.044 -0.043 (-2.441) (-2.797 (-1.189) (-1.145) BUDGET DEFICIT -0.116** -0.125* -0.117* -0.118* (-2.111) (-2.267) (-2.428) (-2.399) DEMOCRACY 0.057** 0.053* 0.060** 0.100 (2.208) (1.902) (2.156) (0.804) HUMAN CAPITAL 0.149 0.203* 0.205* (1.289) (1.893) (1.880) DEMOCRACY SQUARED -0.002 (-0.339) FDI INFLOWS CONTROLS -1.839*** 一1.798*** (-3.597) (-3.357) Constant -6.857** -5.305 -6.316** -6.374** (-2.500) (-1.511) (-2.014) (-2.014) 78 71 68 68 R2 0.68 0.70 0.75 0.75 Note:All regressions are ordinary least squares(OLS)cross-sectional regressions using net FDI inflows as a percent- he depnden from Brune,Garrett,and Guisinger.This variable is a dichotomous measure of controls on FDI inflows that codes countries with no controls as I and countries with controls as 0. The OLS empirical results are presented in Table 2,where the first number re- fers to the coefficient and the second to the T-statistic.The core econometric model from column 1 supports much of the theoretical work done on FDI and on eco- nomic growth more generally.Trade is a complement to FDI,such that countries tending to be more open to trade attract higher levels of FDI.This could be a direct causation,or there is a possibility that other latent factors that increase a country's ability to export products overseas and its ability to attract FDI are present, such as a country's policy toward trade and FDI,could be linked.Not surpris- 49.Brune,Garrett,and Guisinger 2001.from Brune, Garrett, and Guisinger+ 49 This variable is a dichotomous measure of controls on FDI inflows that codes countries with no controls as 1 and countries with controls as 0+ The OLS empirical results are presented in Table 2, where the first number re￾fers to the coefficient and the second to the T-statistic+ The core econometric model from column 1 supports much of the theoretical work done on FDI and on eco￾nomic growth more generally+ Trade is a complement to FDI, such that countries tending to be more open to trade attract higher levels of FDI+ This could be a direct causation, or there is a possibility that other latent factors that increase a country’s ability to export products overseas and its ability to attract FDI are present, such as a country’s policy toward trade and FDI, could be linked+ Not surpris- 49+ Brune, Garrett, and Guisinger 2001+ TABLE 2. The economic and political determinants of FDI (cross-section) Variables Model 1 Model 2 Model 3 Model 4 market size 0+200 0+183 0+268* 0+259 ~1+463! ~1+198! ~1+705! ~1+629! development level 0+088 20+124 20+358 20+336 ~0+351! ~20+340! ~20+945! ~20+874! growth 20+2857*** 20+266** 20+321*** 20+317*** ~22+857! ~22+465! ~23+243! ~23+176! trade 0+030*** 0+031*** 0+034*** 0+034*** ~7+151! ~6+673! ~10+048! ~8+883! natural resources 6+623*** 6+365*** 5+217*** 5+234*** ~3+114! ~2+792! ~2+701! ~2+731! government consumption 20+076** 20+091*** 20+044 20+043 ~22+441! ~22+797! ~21+189! ~21+145! budget deficit 20+116** 20+125** 20+117** 20+118** ~22+111! ~22+267! ~22+428! ~22+399! democracy 0+057** 0+053* 0+060** 0+100 ~2+208! ~1+902! ~2+156! ~0+804! human capital 0+149 0+203* 0+205* ~1+289! ~1+893! ~1+880! democracy squared 20+002 ~20+339! fdi inflows controls 21+839*** 21+798*** ~23+597! ~23+357! Constant 26+857** 25+305 26+316** 26+374*** ~22+500! ~21+511! ~22+014! ~22+014! N 78 71 68 68 R2 0+68 0+70 0+75 0+75 Note: All regressions are ordinary least squares ~OLS! cross-sectional regressions using net FDI inflows as a percent￾age of GDP averaged from 1990–98 as the dependent variable+ ***p , +01, **p , +05, *p , +10+ 600 International Organization