The impact of foreign capital inflows on poverty in Vietnam: An empirical investigation

AbstractThe growing pressure on governments to reduce poverty among other Sustainable Development Goals (SDGs) through harnessing domestic and foreign sources has motivated studies on the relationship between poverty and different economic variables in many developing countries. This study investigates the impact of remittance on poverty in Botswana, employing time-series data from 1980 to 2017. The study employs two poverty proxies—household consumption expenditure and infant mortality rate to capture poverty in its multidimensional form and improve the robustness of the results. Using the autoregressive distributed lag (ARDL) approach, the study finds that remittance inflows reduce poverty in Botswana—both in the short run and in the long run when infant mortality rate is used as a proxy. However, when poverty is measured by household consumption expenditure, remittance was found to have no impact on poverty in the short run and in the long run. The study, therefore, concludes that remittance inflows play a crucial role in reducing poverty and that Botswana can benefit immensely from the surge in remittance inflows by putting in place policies and structures that support remittance inflow.

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Foreign capital inflows and economic growth: the experience of low-income countries in Sub Saharan Africa

Journal of Chinese Economic and Foreign Trade Studies ◽

10.1108/jcefts-07-2020-0028 ◽

2021 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Atif Awad

Keyword(s):

Low Income ◽

Foreign Capital ◽

Ordinary Least Squares ◽

Capital Inflows ◽

Sub Saharan Africa ◽

Low Income Countries ◽

Content Type ◽

Long Run ◽

Foreign Capital Inflows ◽

The Impact

Purpose This paper aims to investigate the long-run impact of selected foreign capital inflows, including aid, remittances, foreign direct investment (FDI), trade and debt, on the economic growth of 21 low-income countries in the Sub Saharan Africa (SSA) region, during the period 1990–2018. Design/methodology/approach To obtain this objective and for robust analysis, a parametric approach, which was dynamic ordinary least squares, and a non-parametric technique, which was fully modified ordinary least squares, were used. Findings The results of both models confirmed that, in the long run, trade and aid affected the growth rate of the per capita income in these countries in a positive way. However, external debt seemed to have an adverse influence on such growth. Originality/value First, this is the initial study that has addressed this matter across a homogenous group of countries in the SSA region. Second, while most of the previous studies regarding capital inflows into the SSA region have focused on the impact of only one or two aspects of such foreign capital inflows on growth, the present study, instead, examined the impact of five types of foreign capital inflows (aid, remittances, FDI, trade and debt).

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Inflationary Rate in Nigeria: Impact of Foreign Capital Inflows

Quarterly Journal of Econometrics Research ◽

10.18488/journal.88.2021.71.44.54 ◽

2021 ◽

Vol 7 (1) ◽

pp. 44-54

Author(s):

Olabode Eric Olabisi

Keyword(s):

Foreign Capital ◽

Negative Impact ◽

Forecast Error ◽

Daily Basis ◽

The Body ◽

Capital Inflows ◽

Parameter Estimates ◽

Long Run ◽

Foreign Capital Inflows ◽

The Impact

As the prices of daily needs are aggravating in Nigeria, the value of the country’s currency (naira) is less appreciated on a daily basis, and this pose a threat to a good standard of living in Nigeria. Therefore, this study investigated the impact of foreign capital inflows on the persistent increase in inflation in Nigeria over the period of 1985 to 2019. The Autoregressive Distributed Lags was used to obtain the parameter estimates of the long run relationship between foreign capital inflows and inflation. By using the Forecast Error Variance Decomposition techniques, the cause-effect analysis of foreign capital inflows and inflation was determined. Results provide evidence of a long run relationship between the series. Results further indicate that inflation is sensitive to foreign capital inflows variables such as net official development assistance received and remittance inflows in Nigeria. Policies that reduce the negative impact on inflation are recommended in the body of the paper.

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FOREIGN CAPITAL INFLOWS AND MANUFACTURING SECTOR GROWTH IN NIGERIA

Malaysian Management Journal ◽

10.32890/mmj2021.25.10 ◽

2021 ◽

Vol 25 ◽

pp. 235-260

Author(s):

Idris Ahmed Sani ◽

Ajengbe Abidemi Samuel ◽

Wada Emmanuel Ome

Keyword(s):

Gross Domestic Product ◽

Foreign Capital ◽

Positive Impact ◽

Manufacturing Sector ◽

Capital Inflows ◽

Domestic Product ◽

Long Run ◽

Foreign Capital Inflows ◽

The Government ◽

The Impact

The study examined the impact of foreign capital inflow on manufacturing sector growth in Nigeria using time series data from 1986 to 2019. The study specifically sought to examine the causal relationship between foreign capital inflows and the growth of the manufacturing sector in Nigeria in the long run The study employed the Autoregressive Distributed Lag (ARDL) estimation technique to account for the impact of foreign capital inflows on the manufacturing sector growth in Nigeria. The study utilized the Contribution of Manufacturing Sector to Gross Domestic Product (MGDP) as proxy for manufacturing sector growth. Manufacturing sector growth was the dependent variable while foreign direct investment (FDI), foreign portfolio investment (FPI) and foreign Aid (FOA) were the independent variables, and were regarded as proxies for foreign capital inflows. The study results revealed that foreign capital inflows through the FDI had a significant positive impact on contributions of the manufacturing sector to gross domestic product (GDP). The study also revealed that foreign capital inflows through the FPI had a significant positive impact on contributions of the manufacturing sector to the GDP. The study further revealed that foreign capital inflows through the FOA had a significant positive impact on contributions of the manufacturing sector to the GDP. Based on these findings, the study has recommended that the Nigerian government should promote foreign capital inflows through the FDI in order to achieve the desired level of manufacturing sector growth in the country’s economy in the long run. The government should also encourage foreign capital inflows through the FPI in order to attain the desired level of manufacturing sector growth in the Nigerian economy. Finally, the government should also support foreign capital inflows through the FOA in order to attain the desired level of manufacturing sector growth in the Nigerian economy in the long run.

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Foreign Direct Investment and the Poverty Reduction Nexus in Tanzania

Journal of Applied Social Science ◽

10.1177/1936724420913582 ◽

2020 ◽

Vol 14 (2) ◽

pp. 223-236

Author(s):

Mercy T. Musakwa ◽

Nicholas M. Odhiambo

Keyword(s):

Foreign Direct Investment ◽

Mortality Rate ◽

Life Expectancy ◽

Direct Investment ◽

Poverty Reduction ◽

Household Consumption ◽

Infant Mortality Rate ◽

Consumption Expenditure ◽

Long Run ◽

Short Run

In this study, the causality between poverty reduction and foreign direct investment (FDI) inflows in Tanzania using time-series data from 1980 to 2014 is investigated. The study attempts to answer one question. Does FDI drive poverty reduction in Tanzania? To answer this question, autoregressive distributed lag (ARDL)-bounds testing approach to cointegration and error correction model (ECM)-based causality model within a trivariate setting was used. The study employs three poverty reduction measures to ensure robustness, namely, household consumption expenditure (pov1), infant mortality rate (pov2), and life expectancy (pov3). The results show that there is a distinct unidirectional causality from poverty reduction to FDI in the short run and in the long run when poverty reduction is measured by household consumption expenditure and life expectancy. A unidirectional causality is confirmed from FDI to poverty reduction in the short run, and no causality is recorded in the long run when infant mortality rate is used as a poverty reduction proxy. Based on these findings, it can be concluded that the causal relationship between FDI and poverty reduction in Tanzania is sensitive to the proxy used to measure the level of poverty and to the time span considered.

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FOREIGN CAPITAL INFLOWS AND MANUFACTURING SECTOR GROWTH IN NIGERIA

Malaysian Management Journal ◽

10.32890//mmj2021.25.10 ◽

2021 ◽

Vol 25 ◽

pp. 235-260

Author(s):

Idris Ahmed Sani ◽

Ajengbe Abidemi Samuel ◽

Wada Emmanuel Ome

Keyword(s):

Gross Domestic Product ◽

Foreign Capital ◽

Positive Impact ◽

Manufacturing Sector ◽

Capital Inflows ◽

Domestic Product ◽

Long Run ◽

Foreign Capital Inflows ◽

The Government ◽

The Impact

The study examined the impact of foreign capital inflow on manufacturing sector growth in Nigeria using time series data from 1986 to 2019. The study specifically sought to examine the causal relationship between foreign capital inflows and the growth of the manufacturing sector in Nigeria in the long run The study employed the Autoregressive Distributed Lag (ARDL) estimation technique to account for the impact of foreign capital inflows on the manufacturing sector growth in Nigeria. The study utilized the Contribution of Manufacturing Sector to Gross Domestic Product (MGDP) as proxy for manufacturing sector growth. Manufacturing sector growth was the dependent variable while foreign direct investment (FDI), foreign portfolio investment (FPI) and foreign Aid (FOA) were the independent variables, and were regarded as proxies for foreign capital inflows. The study results revealed that foreign capital inflows through the FDI had a significant positive impact on contributions of the manufacturing sector to gross domestic product (GDP). The study also revealed that foreign capital inflows through the FPI had a significant positive impact on contributions of the manufacturing sector to the GDP. The study further revealed that foreign capital inflows through the FOA had a significant positive impact on contributions of the manufacturing sector to the GDP. Based on these findings, the study has recommended that the Nigerian government should promote foreign capital inflows through the FDI in order to achieve the desired level of manufacturing sector growth in the country’s economy in the long run. The government should also encourage foreign capital inflows through the FPI in order to attain the desired level of manufacturing sector growth in the Nigerian economy. Finally, the government should also support foreign capital inflows through the FOA in order to attain the desired level of manufacturing sector growth in the Nigerian economy in the long run.

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Foreign capital flows, exports and growth in Zambia

Risk Governance and Control Financial Markets & Institutions ◽

10.22495/rgcv5i4art3 ◽

2015 ◽

Vol 5 (4) ◽

pp. 26-37

Author(s):

Kunofiwa Tsaurai

Keyword(s):

Capital Flows ◽

Foreign Capital ◽

Growth Enhancement ◽

Vector Error Correction ◽

Vector Error ◽

Long Run ◽

Short Run ◽

Foreign Capital Flows ◽

Causality Relationship ◽

The Impact

This study investigates the causality between FDI net inflows, exports and GDP using Vector Error Correction Model (VECM) approach. The words foreign capital flows and FDI are used interchangeably in this study. The findings from the VECM estimation technique is six fold: (1) the study revealed a long run causality relationship running from exports and GDP towards FDI, (2) the study showed a non–significant long run causality relationship running from FDI and exports towards GDP and (3) the existence of a weak long run causality relationship running from FDI and GDP towards exports in Zambia. The study also found out that no short run causality relationship that runs from FDI and exports towards GDP, short run causality running from FDI and GDP towards exports does not exist and there is no short run causality relationship running from exports and GDP towards FDI. Contrary to the theory which says that FDI brings along with it a whole lot of advantages (FDI technological diffusion and spill over effects), the current study found that the impact of FDI in Zambia is not significant in the long run. This is possibly because certain host country locational characteristics that ensures that Zambia can benefit from FDI inflows are not in place or they might be in place but still not yet reached a certain minimum threshold levels. This might be an interesting area for further research. On the backdrop of the findings of this study, the author recommends that the Zambian authorities should formulate and implement export promotion strategies and economic growth enhancement initiatives in order to be able to attract more FDI.

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Money and Household Consumption Expenditure in Developing Asia: Some Panel ARDL Evidence

The Indian Economic Journal ◽

10.1177/00194662211062424 ◽

2021 ◽

pp. 001946622110624

Author(s):

Ghanashyama Mahanty ◽

Himanshu Sekhar Rout ◽

Swayam Prava Mishra

Keyword(s):

Economic Growth ◽

Interest Rates ◽

Household Consumption ◽

Asia Pacific ◽

Consumption Expenditure ◽

Data Set ◽

Final Consumption ◽

Long Run ◽

Short Run

The role of money in influencing real economic activities has been a long-standing debate in macroeconomics. As per the Keynesian theory, household consumption expenditure plays a significant role in promoting economic growth. Given the rapid consumption-led growth pattern in the emerging Asia Pacific region, in this article, we attempt to assess the role of money in influencing household consumption expenditure, which propels economic growth. We employ a panel data set from 2005–2018 for 10 emerging Asian economies, covering Bangladesh, Cambodia, India, Indonesia, Malaysia, Pakistan, Philippines, Sri Lanka, Thailand and Vietnam. Given the region’s heterogeneous nature, we employ a variant of the popular St Louise equation model with autoregressive distributed lag model (ARDL) panel framework based on pooled mean group (PMG) and dynamic fixed effect (DFE) models developed by Pesaran and Shin to study the underlying relationships. Both PMG and DFE models suggest a strong positive relationship between money and household consumption expenditure both in the long run and short run. After allowing for control variables such as government final consumption expenditure and interest rate, the relationships continue to hold steady. Further, the relationship holds true across both narrow (M1) and broad money (M3) measures. The government final consumption expenditure and interest rates do not have influence on household consumption expenditure in the long run, but they have an influence in the short run. JEL Codes: C23, O16, O47, E51, E31, E21

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Cross Border Portfolio Investment and The Volatility of Stock Market Index and Rupiah's Rate

Buletin Ekonomi Moneter dan Perbankan ◽

10.21098/bemp.v17i4.504 ◽

2015 ◽

Vol 17 (4) ◽

pp. 403-432 ◽

Cited By ~ 1

Author(s):

Al Muntasir

Keyword(s):

Foreign Capital ◽

Composite Index ◽

Capital Flow ◽

Capital Inflows ◽

Stock Market Index ◽

Dynamic Relationship ◽

Market Index ◽

Daily Data ◽

Foreign Capital Inflows ◽

The Impact

This paper use daily data during the period 2010-2014 to analyse the impact of foreign capital inflows on capital market volatility and on the volatility of Rupiah’s rate. The results shows the flow of foreign capital positively affect the Jakarta Composite Index (JCI) but not the rate of Rupiah. Using Vector Error Correction Model, this paper finds a cointegrated and dynamic relationship between the changes in foreign capital flow in Indonesia, with the JCI and the exchange rate of Rupiah against USD. Changes in the Rupiah’s rate significantly affect the foreign capital flow and the JCI, while the JCI does not significantly affect the flow of foreign capital and the changes of Rupiah’s rate.

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Financial Liberalization, Economic Growth and Investment Strategy: Lessons from Taiwan for New Industrial Countries

Journal of Business Theory and Practice ◽

10.22158/jbtp.v3n2p188 ◽

2015 ◽

Vol 3 (2) ◽

pp. 188 ◽

Cited By ~ 1

Author(s):

Yu-Wei Lan ◽

Dan Lin ◽

Lu Lin

Keyword(s):

Economic Growth ◽

Institutional Investors ◽

Foreign Capital ◽

Investment Strategy ◽

Capital Inflows ◽

Investment Efficiency ◽

The Real ◽

Foreign Capital Inflows ◽

Foreign Institutional Investors ◽

The Impact

To examine the impact of foreign capital inflows on Taiwan’s economy after internet bubbles of 2000, this study adopts data from the first quarter of 2001 to the second quarter 2015 to test if foreign capital inflows have positive impacts on Taiwan’s economic growth. This study also uses program trading and aims to prove that with financial liberalizations, the investment efficiency of foreign institutional investors is better than domestic institutional investors.The results from the error correction model shows that capital formation, domestic savings and foreign direct investment all have positive relationships with the real economic growth. However, the rate of financing and foreign debt and depreciation all have negative relationships with the real economic growth. The results are all statistically significant. Hence, they do not completely support the hypothesis that foreign capital inflows are beneficial for economic growth.Moreover, this study proves that the futures market in Taiwan is not strong-form market efficient. This result provides support for the hypothesis that the investment efficiency of foreign institutional investors is higher than that of domestic institutional investors. Investors can therefore raise their investment performance by following the investment strategies of foreign institutional investors.

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