The thesis focuses on rarely discussed aspects of international investment incentives, concentrating mainly on factors determining the supplied amount of FDI incentives. This research presents two separate formalized models, each one representing a different approach towards the subject. Consequently, the most important findings are empirically verified by an OLS regression. It can be downloaded here. | The thesis suggests that the supplied amount of FDI incentives in Country A is correlated with the attractiveness of its competitors' incentive schemes, which implies that we cannot reject the weak hypothesis of incentive-based competition. We did not find evidence, however, to support the claim that the contest proceeds in line with our sharp-competition model, which leads us to reject the strong hypothesis of incentive-based competition among neighboring countries. |