The role of commitment to corporate governance principles in ensuring economic development and attracting direct foreign investments: Turkey-Iraq comparison

Foreign direct investments play an important role in increasing the level of economic prosperity and international competitiveness of countries in the global and liberal economy of the 21st century. This situation leads developing economies, which realize the importance of foreign direct investments, to produce and renew policies to attract investments to their countries. In this context, the aim of this study is to research the effect of corporate governance indicators determined by the World Bank on FDI flows in both Turkey and Iraq for the 2007-2021 period. The dependent variable of the study is the share of foreign direct investment inflows in the gross domestic product, while the independent variables are the control of corruption, government effectiveness, political stability and the absence of violence, regulatory quality, rule of law and voice and accountability. In the study, the relationship between variables is tested with panel data analysis by using annual data sets. According to the findings from the analysis, the government's effectiveness on foreign direct investment inflows and the variables of freedom of expression and accountability are positive; The rule of law variable has a negative effect. Additionally, no significant relationship was found between other governance indicators such as political stability and non-violence, control of corruption and regulatory quality and foreign direct investments.