Corporate Taxes and Foreign Direct Investment: An Impact Analysis

2020 ◽  
Vol 5 (2) ◽  
pp. 28-43
Author(s):  
Onome Christopher Edo ◽  
Anthony Okafor ◽  
Akhigbodemhe Emmanuel Justice
Keyword(s):  
Foreign Direct Investment ◽  
Error Correction ◽  
Direct Investment ◽  
Impact Analysis ◽  
Negative Relationship ◽  
Value Added ◽  
Positive Association ◽  
Error Correction Model ◽  
Corporate Taxes ◽  
Correction Model

Objective – The purpose of this study is to investigate the effect of corporate taxes on the flow of Foreign Direct Investment (FDI) in Nigeria between 1983 and 2017. Methodology/Technique – This study adopts an ex-post facto research design. Secondary data was sourced from the World Bank Development Indicator, the Central Bank of Nigeria database, and the Federal Inland Revenue database. The research data was analyzed using the Error Correction Model (ECM). Findings – The coefficient of determination (R2) shows that approximately 77% of systematic changes in FDI are attributed to the combined effect of all of the explanatory variables used in this study. Specifically, the study concludes that Company Income Tax, Value Added Tax, and Custom and Excise Duties have a significant but negative relationship with FDI. In contrast, Tertiary Education Tax has a positive association with FDI. Further, Exchange Rate has a negative but significant relationship with FDI, Inflation had an insignificant but positive association with FDI, and GDP growth Rate and Trade Openness demonstrate a positive and significant association with FDI. Novelty – The findings of this study are distinguishable from previous studies, as it uncovers new evidence that higher Education Tax Rates influences FDI and emerging evidence on the effect of non-tax variables on FDI inflow. Type of Paper: Empirical. JEL Classification: E22, F21, H2, P33. Keywords: Corporate Taxes; Foreign Direct Investment; Error Correction Model; Nigeria; Non-Tax Variables. Reference to this paper should be made as follows: Edo, O.C; Okafor, A; Justice, A.E. 2020. Corporate Taxes and Foreign Direct Investment: An Impact Analysis, Acc. Fin. Review 5 (2): 28 – 43. https://doi.org/10.35609/afr.2020.5.2(1)

PERKEMBANGAN NERACA PERDAGANGAN DAN FAKTOR-FAKTOR YANG MEMPENGARUHINYA

2014 ◽  
Vol 8 (1) ◽  
pp. 51-72
Author(s):  
Ari Mulianta Ginting
Keyword(s):  
Foreign Direct Investment ◽  
Error Correction ◽  
Trade Balance ◽  
Direct Investment ◽  
Error Correction Model ◽  
Vector Error Correction Model ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run

Penelitian ini menganalisis perkembangan neraca perdagangan Indonesia dan faktor yang mempengaruhinya selama periode Kuartal I tahun 2006 sampai dengan Kuartal II tahun 2013 menggunakan Vector Error Correction Model (VECM). Neraca perdagangan Indonesia menunjukkan perkembangan yang positif dalam kurun waktu 2006-2011, dan pertumbuhan negatif selama periode 2012-2013. Penelitian ini juga menemukan bahwa baik dalam jangka panjang maupun jangka pendek, konsumsi domestik dan nilai tukar riil berpengaruh negatif dan signifikan terhadap neraca perdagangan Indonesia, sedangkan variabel Investasi Asing Langsung dan PDB Negara lain berpengaruh positif. Nilai error correction model yang negatif dan signifikan menunjukkan adanya koreksi dari pergerakan variabel pada keseimbangan jangka panjang. Hal ini mengindikasikan pentingnya pemerintah untuk mengeluarkan kebijakan yang tepat untuk mengatasi defisit neraca perdagangan Indonesia, antara lain menjaga stabilitas nilai tukar, mengendalikan konsumsi masyarat terhadap barang impor, dan menarik Foreign Direct Investment. This paper examines the development of Indonesia’s trade balance and its determinant factors from the first quarter of 2006 to the second quarter of 2013 using a Vector Error Correction Model (VECM). The development of trade balance from the year 2006-2011 has shown a positive trend. However between the year 2012 and 2013, the trade balance has been negative.The analysis shows that both in the short run and the long run,the domestic consumption and Real Exchage Rate have negative and significant influence on Indonesia’s trade balance. Whilst Foreign Direct Investment and Foreign GDP have positive effect. The coefficient of Error Correction Model is negative and significant implying that there is correction movement from those variabels in the long run. This study suggests that the Government should make the right policy to overcome the deficit of trade balance by maintaining including exchange rate stability,and household consumption of imported goods as well as by attracting Foreign Direct Investment.

scholarly journals Determinan Ekspor Di Indonesia

2020 ◽  
Vol 4 (2) ◽  
pp. 307-317
Author(s):  
Fanny Septina
Keyword(s):  
Foreign Direct Investment ◽  
Exchange Rate ◽  
Gross Domestic Product ◽  
Error Correction ◽  
Direct Investment ◽  
Oil And Gas ◽  
Error Correction Model ◽  
Domestic Product ◽  
Correction Model ◽  
Us Dollar

ABSTRACTThis study aims to explore macroeconomic factors that affect non-oil and gas exports in Indonesia. The research data are non-oil and gas export data, Gross Domestic Product, inflation, US dollar exchange rate, foreign direct investment in the 2010-2019 period published by Bank Indonesia statistics. The research method uses the Vector Error Correction Model (VECM) analysis with the Augmented Dickey Fuller (ADF) stationary test, Johansen's cointegration test, Granger causality test, Error Correction Model. The results showed there was a cointegration relationship between all dependent and independent variables, a direct relationship with the US dollar exchange rate and inflation on Gross Domestic Product, Gross Domestic Product on exports. In the short term Gross Domestic Product, inflation, exchange rates, and foreign direct investment have no significant effect on non-oil and gas exports. In the long run, Gross Domestic Product has a significant effect on non-oil and gas exports.Keywords: non-oil export, macroeconomy, cointegration, causality, error correction model

scholarly journals Relationship between Trade Openness and Inflation: Empirical Evidences from Pakistan (1976-2010).

2011 ◽  
Vol 50 (4II) ◽  
pp. 853-876 ◽  
Author(s):  
Sehar Munir ◽  
Adiqa Kausar Kiani
Keyword(s):  
Error Correction ◽  
Trade Openness ◽  
Value Added ◽  
Error Correction Model ◽  
Series Data ◽  
Vector Error Correction Model ◽  
Correction Model ◽  
Vector Error Correction ◽  
Unit Root Testing ◽  
Vector Error

This study empirically verifies the existence of significant relationship between inflation and trade openness for Pakistan using annual time-series data for the period of 1976 to 2010. The basic objective of this study is to examine the Romer‘s hypothesis for Pakistan with real agriculture value added, real exchange rate, real gross domestic product, financial market openness, money and quasi money and used trade openness, import openness and export openness ratios separately as explanatory variables with inflation rate as dependent variables. For this purpose, we have used multivariate Johansen (1998) and Johansen and Juselius (1990) Maximum Likelihood Cointegration Approach and a Vector Error Correction Model (VECM) and the expected empirical findings shows that there is a significant positive long-run relationship between inflation and trade openness, which rejects the existence of Romer‘s hypothesis for Pakistan. JEL classification: B26, E31, P24, P44 Keywords: Trade Openness, Inflation, Unit Root Testing, Multivariate Cointegration Approach, Vector Error Correction Model, Pakistan

Nexus Between FDI, Agriculture, and Rural Development: Evidence from Asian Countries

2021 ◽  
Vol 11 (4) ◽  
pp. 311-319
Author(s):  
Sujan Chandra Paul ◽  
Nusrat Jahan ◽  
Ashim Kumar Nandi ◽  
Md Asiqur Rahman
Keyword(s):  
Foreign Direct Investment ◽  
Rural Development ◽  
Direct Investment ◽  
Agricultural Land ◽  
Negative Relationship ◽  
Value Added ◽  
Time Frame ◽  
Negative Association ◽  
Female Employment ◽  
Asian Countries

The aim of this study is explore the effect of foreign direct investment on agriculture and rural development. For this, panel data of 46 countries from Asia were accumulated for the time frame 1991–2018. The models OLS, POLS, 2SLS, and GMM are employed in this study. The study reveals that there is a favorable association between foreign direct investment and agricultural land as percentage of total land using the models OLS, POLS, 2SLS. In stark contrast, value added for agriculture, forestry, and fishing has an unfavorable association with foreign direct investment in all models employed in the study. Furthermore, female employment in agriculture has a negative association with foreign direct investment in OLS, 2SLS and GMM models, whereas male employment in agriculture has a negative association with foreign direct investment in the POLS model only. Land under cereal production has a favorable association with foreign direct investment in all models except POLS, and permanent cropland has a favorable association with foreign direct investment in all models except GMM. In addition, rural population has a positive relationship with foreign direct investment in OLS, POLS and 2SLS and a negative relationship with foreign direct investment in GMM.

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