Regional Policy of Territory Brand Promotion: Investment Attractiveness Determinants

Abstract

The article studies factors influencing investment attractiveness of regions. The practical value of the work is in its empiric research which has been carried out. It allows to assess separately influence of material and non-material factors of a territory brand and to show which events carried out by regional and municipal authorities to promote territory are the most efficient to attract different groups of investors.
The research is based on open data selection in 83 regions of Russia for the period from 2010 till 2013 with the total of 332 records: region characteristics, both material and non-material attributes of territory brand, combined in independent variables by using factor analysis and the characteristics of investments attractiveness, have allowed forming four independent variables. Four regression models are evaluated by using two types of econometric models (with fi xed and random eff ects).
The analysis results of the models have shown that the inflow of foreign investments is practically not influenced by the non-material brand attributes, while the most valuable territory brand characteristic for this type of investment is the potential of labour market: the share of population with higher education, competence in English, skilled workforce. Non-material brand attributes are important to attract national investments. Among them the strongest attributes are territory promotion in mass-media, research and technological development as well as state events. The acquired results can be used by the federal, regional and municipal authorities while drawing the territory promotion strategies.