Determinants of propensity to intensify the cooperation among local governments in FDI promotion: The case of Northern Key Economic Zone of Vietnam

This study investigates the determinants of cooperation intensity among local governments in promoting Foreign Direct Investment (FDI) within Vietnam's Northern Key Economic Zone (KEZ), which is emerging as a critical hub for FDI but faces significant disparities in FDI distribution across its provinces. The study applies the Institutional Collective Action (ICA) Framework. It is complemented by the Theory of Planned Behavior (TPB) and Risk Aversion Theory to form a comprehensive understanding of how gaps in perception and expectation of benefits, costs, and risks shape cooperative decisions. The findings indicate that while the gap between perception and expectation of benefits and transaction costs does not significantly impact the propensity to intensity of the cooperation, the gap of risks of collaboration is a key determinant. This research emphasizes the need for coordinated strategies to mitigate risks and enhance trust among local governments, offering actionable insights for policymakers to foster more effective intergovernmental collaboration, ultimately optimizing resource allocation and boosting FDI attraction.