Volume 40, Issue 1 Political environment and attraction of foreign direct investment: an institutionalist approach Eduardo Henrique de Borba Santa Catarina State University (UDESC) Ana Paula Menezes Pereira Santa Catarina State University (UDESC) Abstract The study examines the relationship between the quality of the institutional arrangements of political environment and the attraction of foreign direct investment (FDI). Panel models were estimated for 123 countries from 2011 to 2016, where the dependent variable was the FDI net inflows, explained by two institutional variables related to the political dimension. Due to the strong correlation between the institutional variables, they were evaluated in separate models, in addition to versions with and without the use of instruments. The results suggest that the quality of the institutional arrangements of the political environment is essential to attract FDI. The authors thank the Research and Innovation Support Fundation of Santa Catarina State (FAPESC) for the financial support. Citation: Eduardo Henrique de Borba and Ana Paula Menezes Pereira, (2020) ''Political environment and attraction of foreign direct investment: an institutionalist approach'', Economics Bulletin, Volume 40, Issue 1, pages 837-845 Contact: Eduardo Henrique de Borba - eduardo.borba14@gmail.com, Ana Paula Menezes Pereira - ana.paula.menezes.pereira@gmail.com. Submitted: August 12, 2019. Published: March 25, 2020.