The article examines the relationship between economic infrastructure, capital formation, and foreign investment in Hungary from 1995 to 2012. By analyzing the data, the researchers found that changes in infrastructure and private capital positively impact foreign investment in the short term. However, in the long term, foreign investment and private capital are substitutes, while infrastructure attracts private capital. The study also shows that the real exchange rate affects foreign investment in the long run. Overall, the findings suggest that foreign investment and capital formation adjust quickly in the short term, while infrastructure and exchange rates play a more indirect role.