ERBE 05 2 03
FDI-Led Development without Structural Upgrading: Serbia versus Postcommunist EU Member States
a Faculty of Economics, University of Novi Sad, Serbia.
* Corresponding author: novica.supic@ef.uns.ac.rs
To cite this article:
Novica Supic 2026. FDI-Led Development without Structural Upgrading: Serbia versus Post-communist EU Member States n, European Review of Business Economics V(2): 47-71.
DOI: https://doi.org/10.26619/ERBE-2026.5.2.3
Received: 11 May 2026. Accepted: 1 June 2026. Published: 30 June 2026.
Language: English
Abstract
This paper reassesses Serbia’s FDI-led development model from a post-Keynesian perspective, comparing Serbia with postcommunist EU member states. It shifts attention from the volume of FDI to its sectoral composition and asks whether large foreign-capital inflows have supported structural upgrading. The evidence shows a quantity–quality divergence: Serbia has attracted substantial FDI, but its inflows have remained weakly oriented toward high-value-added activities. Panel regression estimates confirm a negative Serbia-specific trend in the high-value-added share of FDI relative to the postcommunist EU member states comparison group. The findings suggest that Serbia’s FDI-led model has been macroeconomically useful but developmentally incomplete, supporting employment and external financing without producing a comparable transformation of the productive structure or labour market.
Keywords
FDI-led development; structural upgrading; labour market outcomes; Post-Keynesian economics; Serbia.
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