Host-Country Characteristics and EU Policy Effects on Swedish Foreign Direct Investment: A Comparison of Spain and Poland

Abstract

This thesis examines how economic characteristics within host countries, along with EU-level policy changes, influence Swedish firms’ foreign direct investment in Spain and Poland. Using Eurostat panel data on Swedish outward FDI stock positions across EU host countries over 2013–2024, the study adopts a two-step empirical approach. The first analysis estimates the macroeconomic determinants of Swedish outward FDI within the EU using a panel regression model, examining labor costs, corporate taxation, market size, and freedom score, incorporating a regional dimension. The second analysis investigates whether a policy-related shift around 2017 is associated with differential changes in Swedish FDI, with particular focus on Spain and Poland. The quantitative analysis is complemented by semi-structured interviews with executives of Swedish multinational firms taking part in investment decisions. The findings contribute to the literature on FDI determinants by focusing specifically on Sweden as a source country and combining econometric analysis with firm-level qualitative insights.