DETERMINANTS OF THE INFLOW OF FOREIGN DIRECT INVESTMENT: EMPIRICAL EVIDENCE FROM PAKISTAN
This study aims to investigate empirically the various factors which affect the inflow of Foreign Direct Investment (FDI) in Pakistan over the period of 1980 to 2018 and used in this study are population, GDP per capita represent market size, energy consumption, inflation rate and financial development as explanatory variables. The Augmented Dickey Fuller and Philips Perron tests were used to check stationarity level of the data series; the Autoregressive Distributed Lag (ARDL) approach was employed. The empirical results show that GDP, Inflation, Energy and population growth have positive and significant effect on FDI, while the financial development have negative and significant effect on FDI. Findings of the study suggest that the government should make suitable policies to attract more FDI into Pakistan in order to improve economic growth and thereby society welfare.