Foreign direct investment and international trade across the former Soviet economies: What do we know after 30 years of research?

Abstract

Aim/purpose – This paper surveys three decades of empirical literature on foreign direct investment (FDI) and international trade across the former Soviet economic space. In this survey, we outline the current state of research, discuss data limitations, and iden- tify topics for further studies. Design/methodology/approach – The methodology used in this study is a systematic literature review. Multiple databases were searched, including Google Scholar, IDEAS (RePEc), JSTOR, Web of Science, and others. In total, 59 papers published between 1990 and 2023 were analyzed. Findings – Our findings are severalfold. First, we highlight severe data collection prob- lems related to foreign equity and trade outside the Baltics, Ukraine, Russia, and some Central Asian Republics (CARs). As a result, we point out the limited availability of studies that use contemporary data and cover important economic events, such as the European accession of the Baltics, the formation of new preferential trade agreements, and economic re-integration centered around Russia, and Ukraine’s political stability. Research implications/limitations – This study should assist researchers in identifying prospective research directions in post-communist economic research. The main limita- tions of this survey are i) the total number of papers surveyed (59), ii) the focus on em- pirical studies, and iii) the specific geographical area considered. Originality/value/contribution – Despite the critical role of FDI and trade in transition- al economies, plenty of relevant topics have remained undiscovered (e.g., the relation- ship between outward FDI and profit shifting). To the best of our knowledge, no system- atic survey has been done on these two areas of research. Keywords: Foreign direct investment, international trade. JEL Classification: F13, F15, F23, P33.