Source: Devdiscourse | Original Published At: 2026-10-03 17:06:10 UTC
Key Points
- The study examined digital connectivity, institutional quality, and foreign direct investment in BRICS and ASEAN-5 economies from 2003 to 2023.
- In baseline BRICS models, digital connectivity showed negative coefficients for FDI, with statistical significance in some specifications; ASEAN-5 showed a similar negative pattern.
- Using an alternative FDI measure, digital connectivity became positive and statistically significant for BRICS, highlighting sensitivity to measurement choices.
- In BRICS, rule of law, regulatory quality, and voice and accountability interacted positively with the connectivity-FDI relationship, while ASEAN-5 showed no comparable institutional moderation.
- Robustness checks weakened the case for a universal governance effect, with results depending on the FDI definition, statistical method, and sample used.
- The study suggests investment policy should move beyond internet penetration and aggregate governance rankings to consider broader digitalization and the composition of FDI.