EFFECT OF FOREIGN DIRECT INVESTMENT ON GROWTH OF HOSPITALITY INDUSTRY IN USA
Abstract
Purpose of the study: The study examined the effect of foreign direct investment on the growth of the hospitality industry in the USA.
Research methodology: The study embraced the descriptive research design. The target population was 413 employees from the Ministry of Hospitality in the USA. The sample size was 2013. The study used questionnaires to collect the data. The analysis of the data was done using descriptive and inferential statistics.
Findings: The correlation results indicated that foreign direct investment is positively and significantly associated with the growth of the hospitality sector (r=.706, p=.000). Foreign direct investment can explain 37.9% of the variations in the growth of the hospitality sector in the USA. The correlation results showed that foreign direct investment is positively and significantly related to the growth of the hospitality sector in the USA (β=0.156, p=0.009).
Conclusion: It is concluded that foreign direct investment is satisfactory in explaining the growth in the hospitality sector among the hotels in the USA. The results showed that when the foreign direct investment improves by one unit, the growth in the hospitality sector among the hotels in the USA will increase by 0.156 units while other factors are held unchanged. Foreign direct investment plays a significant role in developing the hospitality sector in the USA.
Recommendations: The government needs to put strategies that will increase foreign direct investments in the country. The government should encourage foreign investors by offering them favorable taxes, adequate raw materials, labor and adequate security so that they may attract more investors to the country. The government should consider making policies that are conducive for businesses in the country. The tax payable by firms needs to be adjusted from time to time to attract more investors. The firms' net profits should be considered before making the taxation policy.
Keywords: Foreign direct investment, growth, hospitality industry, USA
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