The Connection Between Economic Complexity, Foreign Direct Investment and Economic Freedom: A Panel ARDL Approach for The Black Sea Economic Cooperation Organization (BSEC)

Geographically, the Black Sea Economic Cooperation Organization (BSEC) is of great strategic importance. Because the Black Sea is a crossing point between both Europe and Asia. Due to its geopolitical location, BSEC offers great opportunities in many aspects such as energy, trade volume, logistics, etc. This is important understanding the potential of BSEC countries. In the study, the connection between economic complexity (EC), foreign direct investment (FDI) and economic freedom (EF) and in 13 BSEC member countries was investigated. In this study, which covers the years 1998-2022, the existence of the long-run connection was analyzed through the PMG estimator, which is frequently used in the Panel ARDL method. The results reveal that EC and EF increase FDI in both short and long run. Accordingly results of error correction model, positive and significant connection was found in 10 BSEC member countries. In 3 countries, the error correction model is insignificant.