The attractiveness of foreign direct investments for business: the case of the selected european union members

Foreign direct investment is a very important factor in the country's development, the transport of goods, services, know-how, and it is one of the main indicators of the country's degree of globalisation. Based on the principle of inflows and outflows of foreign direct investment, we can define the openness of the economy, which therefore contributes to development but also to its vulnerability to changes in global markets. In this study, we assess the attractiveness and productivity of countries in terms of foreign direct investment. We examined 24 countries of the European Union during the period 2011-2019, using the Malmquist productivity index and cluster analysis among the main methods included in the study. Based on the research findings it can be concluded that there are significant differences in the changes in the attractiveness of countries at the beginning and end of the period under review, with a trend reducing the attractiveness of countries. Furthermore, there are significant differences between countries in terms what is the reason for changes in productivity/attractiveness. While management influences prevail in Central and Eastern European countries, technological influences prevail in Western European countries. These findings can be incorporated into policies in order to increase the attractiveness of the countries of the European Union as well as the European Union as a whole.