Capital inflows have a strong presence that influences destination countries' development of institutions, which can in turn help resuscitate a stopped economy and re-attract capital that was lost during crises such as the recent public health crisis While the previous literature emphasizes the mechanism that foreign investors press or even threaten the local government for change, this paper explores empirically whether institutional improvement can be achieved through the channel that host countries voluntarily reform institutions in anticipation of potential investments predicted by the exogenous geographical and cultural characteristics of the recipient countries Given that countries with better institutional quality can accumulate larger FDI stocks, we still find that the need for more FDI, in contrast to FPI and debt, gives higher incentives to host countries to strategically improve their institutions before seeking capital overseas Moreover, the predicted FDI exerts more prominent impacts on institutions on constraining elite than those involved in launching a business, enforcing contracts, and protecting properties The results imply that a long-run plan for upgrading elite constraint institutions is crucial for a post-pandemic FDI reboot

中文翻译：

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关于预计 FDI 流入在塑造制度中的作用

资本流入对目的地国制度发展的影响很大，这反过来又有助于恢复停滞的经济并重新吸引在最近的公共卫生危机等危机中流失的资本。投资者施压甚至威胁当地政府进行改革，本文实证探讨了通过东道国自愿改革制度的渠道是否可以实现制度改进，以预期受援国的外生地理和文化特征所预测的潜在投资。更好的制度质量可以积累更大的 FDI 存量，我们仍然发现需要更多的 FDI，与 FPI 和债务相比，为东道国在寻求海外资本之前从战略上改进其制度提供了更高的激励。此外，与参与开办企业、执行合同和保护财产的机构相比，预计的 FDI 对限制精英的机构产生的影响更为显着。结果表明，长期升级精英约束机构的运行计划对于大流行后重新启动外国直接投资至关重要