When Does Foreign Direct Investment Lead to Inclusive Growth?

Countries need a tremendous amount of investment to utilize existing resources and enhance productivity in order to ensure inclusive growth in the economy. Foreign Direct Investment (FDI) by providing the required investment can fulfil the saving-investment gap. The paper makes an empirical investigation of the effectiveness of FDI as a financing tool for inclusive growth. The study also examines how the effectiveness of FDI varies across economies with varying level of institutional quality. The results suggest that FDI plays a significant role in achieving inclusive growth, especially in economies with a low and medium level of institutional Quality. A deep underpinning of our inclusive growth variable brought thoughtful insights such as low and middle-income economies, which mostly belong to the low and medium level of institutional quality cluster. They should adopt policies that enhance the existing spectrum of opportunities. Whereas equity should be the top-most priority for high-income economies.

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Foreign Direct Investment, Governance and Inclusive Growth in Sub-Saharan Africa

SSRN Electronic Journal ◽

10.2139/ssrn.3861251 ◽

2021 ◽

Author(s):

Isaac Kwesi Ofori ◽

Simplice Asongu

Keyword(s):

Foreign Direct Investment ◽

Direct Investment ◽

Sub Saharan Africa ◽

Inclusive Growth ◽

Sub Saharan

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ICT Diffusion, Foreign Direct Investment and Inclusive Growth in Sub-Saharan Africa

SSRN Electronic Journal ◽

10.2139/ssrn.3846828 ◽

2021 ◽

Author(s):

Isaac Kwesi Ofori ◽

Simplice Asongu

Keyword(s):

Foreign Direct Investment ◽

Direct Investment ◽

Sub Saharan Africa ◽

Inclusive Growth ◽

Sub Saharan

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Achieving Inclusive Growth in Nigeria through Exports: An Empirical Investigation

South Asian Journal of Social Studies and Economics ◽

10.9734/sajsse/2019/v3i130092 ◽

2019 ◽

pp. 1-14

Author(s):

Ozegbe, Azuka Elvis ◽

Ogunlana, Olarewaju Fatai ◽

Nwani, Stanley Emife ◽

Onochie, Stanley Nwabuisi

Keyword(s):

Foreign Direct Investment ◽

Direct Investment ◽

Inclusive Growth ◽

Vector Error Correction ◽

Vector Error ◽

Long Run ◽

Integration Test ◽

Oil Exports ◽

Oil Export ◽

Per Capita

The study investigated the effectiveness of export in the attainment of inclusive growth in Nigeria. The study functionally expressed inclusive growth as a function of oil export, non oil export, investment and foreign direct investment. In order to achieve the objectives of the study, a number of literature were reviewed, however, there were empirical regularities in the literature embracing inclusive growth as critical determinant of sustainable growth. Within the context of secondary data which spanned the period 1970-2016, the study utilized econometric technique to analyze inclusive growth model. In the model, real per capita income (proxy inclusive growth) is expressed as a function of oil exports, non oil export, investment and foreign direct investment. In particular, a number of diagnostic tests were carried out on the data before estimation in order to prevent spurious results. These include the unit root test, co-integration test and vector error correction tests. The stationarity test indicated that the data were stationary at first difference, while the co-integration test suggested long run co movement among the variables. In addition, the vector error correction model indicated the relationships among the inclusive growth fundamentals. Findings from the results indicated that in the long run, the coefficients of oil and non oil exports have negative effect on inclusive growth (proxied by real GDP per capita) while investment and foreign direct investment impacted positively on inclusive growth, while in the short run, oil exports and non oil export positively and significantly influenced inclusive growth in Nigeria. This study further suggested that government should intensify policy towards stimulating oil export and promote foreign investment inflows. More so, policy thrust should also embrace diversification of the economic base from monolithic base structure to agriculture.

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