Factors that influence the choice of a destination country for Brazilian foreign direct investment

The objective of the article is to investigate the factors that influence the choice of the destination of Brazilian Foreign Direct Investment (FDI). This paper analyses especially if the decision regarding the locality is influenced by psychic distance. This article contributes to literature, firstly, by investigating the investment decisions of Brazilian companies from the theoretical perspective of psychic distance. Secondly, as Brazil is a country considered to have an emerging economy, it allows us to observe whether the results found in economies considered developed are repeated in developing localities. Linear regression was used to test the influence of differences in religion, language, industrial development, education, democratic level and political ideology, on the destination of Brazilian FDI. The results point to economic return as a determining factor in the internationalization process of Brazilian companies. Contrary to the theory of psychic distance, the most distant countries received the largest share of Brazilian multinational investments.