Analyzing the reality of foreign direct investment and measuring its impact on economic growth for the period (2000-2017)Algeria as a model

2021 ◽  
Vol 11 (1) ◽  
pp. 165-175
Author(s):  
Bakir Hameed Jasoum ◽  
Noaman Mundher Younus ◽  
Fouad Farhan Hussein
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Capital Investment ◽  
Arab Countries ◽  
Advanced Technology ◽  
Investment Environment ◽  
Bilateral Agreements ◽  
The Impact

Foreign direct investment is of paramount importance at the international level, especially in developing countries, as many studies have shown its effective impact and its essential role in the medium and long term in advancing economic growth by stimulating GDP rates, providing employment opportunities, providing expertise and advanced technology. What prompted most Arab countries, including Algeria, to exert efforts in order to provide an appropriate investment environment to attract direct investment through a set of economic reforms, guarantees and facilities, and their conclusion of multiple bilateral agreements to encourage and protect the foreign investor.The research aims to know the extent of the impact of foreign direct investment on economic growth in Algeria for the period (2000-2017) by using standard analysis tools to identify the nature of the relationship between foreign direct investment and economic growth.The research also found that the gross domestic product has a positive relationship with foreign direct investment, that is, when foreign direct investment increases by one unit, this will inevitably lead to an increase in economic growth by (6.43). The research also recommends the necessity of adopting economic structural reform policies in line with the reality The Algerian economy, and working to develop and develop the financial markets through their size and tools, with an emphasis on the issue of legislation and laws that guarantee the regulation of capital investment flows.

scholarly journals PENGARUH PENANAMAN MODAL ASING TERHADAP PERTUMBUHAN EKONOMI DI INDONESIA

Media Ekonomi ◽  
2016 ◽  
Vol 24 (1) ◽  
pp. 63
Author(s):  
Fajar Bimantoro ◽  
Mona Adriana S
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Financial Crisis ◽  
Direct Investment ◽  
Global Financial Crisis ◽  
Consumer Price Index ◽  
Impulse Response Function ◽  
Short Term ◽  
The Impact

<em>The present study aimed to analyze the relationship between the level of foreign direct investment to Indonesia's economic growth in the period 1991-2014.Fokus of the present study was to analyze the short-term relationship between foreign direct investment and economic growth Indonesia. In addition, along with the financial crisis 2008 global bit much negative of Indonesia affected by the global economic slowdown due to the crisis. This prompted the present study was to also perform forecasting of the impact of global financial crisis on foreign direct investment and relation to economic growth. To answer these questions, this research chose VAR Vector Auto Regression or as a method to answer the research questions. Gross Domestic Product (GDP), Consumer Price Index, BI rate, and the Exchange Rate, the variables used in this research. The estimation results of the VAR indicate that direct investment from abroad did not have an impact on economic growth in the long term but has a strong bond in the short term against the growth of economics. This indicates that foreign investment into Indonesia increasingly quality in promoting economic growth. In addition, the results of forecasting using impulse response function indicates there will be the tendency of a decrease in the level of foreign direct investment and economic growth in Indonesia.</em>

scholarly journals FDI and long-term economic growth in Egypt

2017 ◽  
Vol 13 (1) ◽  
pp. 65-74
Author(s):  
Saif Alhakimi
Keyword(s):  
Economic Growth ◽  
Time Series ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Time Series Data ◽  
Government Expenditure ◽  
Wage Structure ◽  
Series Data ◽  
The Impact

This research paper aims to empirically analyze the impact of FDI on the long-term economic growth of Egypt. An empirical model was developed to explain the aggregate output, including total labor force, capital stock, foreign direct investment, government expenditure, and the real exchange rate. Annual time-series data from 1990–2013 were then used to estimate the model. Prior to calculating this estimation, the properties of the time series were diagnosed, and an error-correction model was developed and assessed. The overall results suggest that foreign direct investment makes a positive, yet weak and insignificant, contribution to the long-term economic growth of Egypt. This finding warrants further investigation to explore the possible reasons behind it, such as the degree of spillover that FDI has on economic growth and its impact on employment in areas like job creation, wage structure, research, and development.

scholarly journals The Impact of Human Capital and Foreign Direct Investment on Economic Growth: An Empirical Study on Jordan

2020 ◽  
Vol 10 (2) ◽  
pp. 182
Author(s):  
Mustafa Mohammad Alalawneh
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Advanced Technology ◽  
Bounds Testing ◽  
Long Run ◽  
Auto Regressive ◽  
Human Capital Index ◽  
The Impact

Human capital is a real factor in improving the investment climate and attracting foreign investment. FDI also increases human capital in the host country through the transfer of advanced technology and the rehabilitation of local labor. The importance of the study comes from Jordan's serious endeavor to attract foreign direct investment and to present itself as a rich country in human and qualified capacities. This study examines the effect of human capital and foreign direct investment on economic growth in Jordan employing Auto Regressive Distributed Lags Bounds Testing (ARDL BT) co-integration method for the spanning period from 1984 to 2018. The results indicate that there is a long- run relationship among variables. The results showed that there is a negative and statistically significant effect of human capital index (HCI) on economic growth (GWP) in the long run, and a positive and statistically significant effect of FDI (GFDI) on economic growth (GWP) in the long run. The estimation results indicate that a 1% increase in (HCI) decreases (GWP) by 0.272%, and a 1% increase in (GFDI) increases (GWP) by 0.006%. This study is one of the few studies that highlight the challenges facing both HC and FDI in increasing economic growth in Jordan and provides some recommendations.

scholarly journals The Impacts of Human Resources and Foreign Direct Investments to Vietnam’s Economic Growth

2018 ◽  
Vol 8 (4) ◽  
pp. 125
Author(s):  
Nguyen Van Huong ◽  
Dang Quy Duong ◽  
Do Thi Thu Thuy
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Foreign Direct Investment ◽  
Human Resources ◽  
Direct Investment ◽  
Opposite Effect ◽  
Short Term ◽  
Short And Long Term ◽  
The Impact

Research on human resources, foreign direct investment and economic development are important issues in assessing the effectiveness of employment as well as attracting foreign direct investment (FDI) in the economy. In this study, the author analyzes the impact of human resource factors and FDI on economic growth in Vietnam from 1990 to 2017. By regression analysis based on the ARDL model, the result shows FDI has only a positive effect on economic growth in the short term but has the opposite effect in the long term. At the same time, unemployment rates have the opposite effect on economic growth in the short term. Average life expectancy does not affect economic growth in both the short and long term. From this result, the author also offers some suggestions for economic development in both the short and long term.

scholarly journals Determinants of Foreign Direct Investment in SAARC Countries: An Investigation Using Panel VAR Model

2011 ◽  
Vol 3 (2) ◽  
pp. 117-126
Author(s):  
Rudra P. Pradhan
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Exchange Rate ◽  
Direct Investment ◽  
Var Model ◽  
Current Account Balance ◽  
Panel Var ◽  
Policy Variable ◽  
The Impact

Foreign direct investment (FDI) is considered to be a policy variable to enhance economic growth in the economy. So identifying the determinants of FDI is very challenging among the policymakers. The paper examines the determinants of foreign direct investment in seven SAARC countries over the period 1980-2010. Using panel VAR model, the paper finds that foreign direct investment are largely influenced by economic growth, exchange rate, inflation, labor population, trade balance, current account balance and long term debt outstanding. The impact of economic growth and exchange rate are bidirectional, while the other factors are unidirectional on FDI inflows.

A Study on the Impact of Foreign Direct Investment (FDI) on Indian Economy

2017 ◽  
Vol 3 (3) ◽  
Author(s):  
G. Suresh Babu ◽  
C. Sreeramulu
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Policy Framework ◽  
Fdi Inflows ◽  
Internal Resources ◽  
Fund Flow ◽  
The Government ◽  
The Impact

Foreign Direct Investment (FDI) is fund flow between the countries in the form of inflow or outflow by which one can able to gain some benefit from their investment whereas another can exploit the opportunity to enhance the productivity and find out better position through performance. The effectiveness and efficiency depends upon the investors perception, if investment with the purpose of long term then it is contributes positively towards economy on the other hand if it is for short term for the purpose of making profit then it may be less significant. Depending on the industry sector and type of business, a foreign direct investment may be an attractive and viable option. Any decision on investing is thus a combination of an assessment of internal resources, competitiveness, and market analysis and market expectations. The FDI may also affect due to the Government trade barriers and policies for the foreign investments and leads to less or more effective towards contribution in economy as well as GDP of the economy Foreign direct investment (FDI) as a strategic component of investment is needed by India for achieving the economic reforms and maintains the pace of growth and development of the economy. The paces of FDI inflows in India initially were low due to regulatory policy framework but there is a sharp rise in investment flows from 2005 towards because of the new policy has broadened. Foreign direct investment (FDI) has been viewed as a power affecting economic growth (EG) directly and indirectly. The main purpose of the study is to analyse the impact of FDI on economic growth in India.

scholarly journals The Relationship of Economic Growth and Foreign Direct Investment on Financial Development: Empirical Evidence from Palestine

2021 ◽  
pp. 14-35
Author(s):  
Nemer Badwan
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Stock Market ◽  
Financial Development ◽  
Capital Accumulation ◽  
Direct Investment ◽  
Output Growth ◽  
The Impact ◽  
The Relationship

Purpose: The purpose of this research is to investigate the impact and current link between economic growth and foreign direct investment (FDI) on financial development in Palestine, as well as the role of financial development in influencing this relationship. Design/Methodology/Approach: The logical reasoning approach associated with quantitative research was applied in this study, which was backed up by experience and positivism as philosophical viewpoints. Data on economic growth indicators, foreign direct investment (FDI), financial development, and other control variables were also used, spanning the years (1998 to 2019). To determine whether there is an effect and a relationship between economic growth, foreign direct investment (FDI), and financial development in Palestine, Johansen's co-integration analysis method will be used. Results: Johansen's co-integration discovered that economic growth, foreign direct investment (FDI), and financial development have a favourable influence and a Long-Term association. Furthermore, there was a statistically significant relationship between stock market financial development indices and foreign direct investment (FDI). Practical Implications: This study adds to the literature by evaluating whether foreign direct investment (FDI) drives growth through financial development networks and other factors that can drive growth in addition to foreign direct investment (FDI). A well-developed financial market, according to research, will boost the impact of indirect foreign direct investment (FDI) on economic growth. By offering enough liquidity services that increase links between local and global investors, a well-developed stock market will promote capital accumulation activities and output growth. Originality/Value: This study is unique in that it examines the impact and relationship between economic growth and foreign direct investment (FDI) in Palestine on financial development, which must be considered in all developing countries' Long-Term development plans. Simultaneously, this study is a step ahead in examining the relationship between economic growth and foreign direct investment (FDI) in Palestine, as well as their primary function in financial development.

scholarly journals Impact of Foreign Direct Investment on Economic Growth in Ethiopia

2021 ◽  
Vol 4 (10) ◽  
pp. 56
Author(s):  
Abdillahi Nedif Muse ◽  
Saidatulakmal Mohd
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Capital Investment ◽  
Positive Impact ◽  
Vector Autoregressions ◽  
Government Consumption ◽  
Long Run ◽  
The Impact

This article analyses the impact of foreign direct investment (FDI) on Ethiopia’s economic growth. For this purpose, it uses Vector Autoregressions (VARs) model for the period comprised by years 1981-2017. It finds that FDI had a significant positive impact on Ethiopia’s economic growth for both the short and long-run periods. Adequate human capital and stable macroeconomic envirornment have catalysed the contribution of FDI to economic growth. Gross fixed capital formation and government consumption exerted a negative and significant effects on economic growth during the period of interest. Moreover, the study reveals that there is no causal relationship between FDI and economic development. Ethiopia needs to open up the economy and restructure the financial sector to attract foreign multinational companies (MNC), especially in the manufacturing and agro-industry sectors. Human capital investment should be strength to absorb more foreign direct investment and transform the agricultural-based economy to a modern one. Effective budgeting system and prioritisation of government consumption will support a more rapidly growing economy.

The nexus between financial development and energy consumption: Estimating the role of foreign direct investment, economic growth and urbanization

2021 ◽  
pp. 0958305X2110453
Author(s):  
Jaleel Ahmed ◽  
Shuja ur Rehman ◽  
Zaid Zuhaira ◽  
Shoaib Nisar
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Energy Consumption ◽  
Financial Development ◽  
Latin American ◽  
Direct Investment ◽  
Negative Impact ◽  
Positive Impact ◽  
Supply And Demand ◽  
The Impact

This study examines the impact of financial development on energy consumption for a wide array of countries. The estimators used for financial development are foreign direct investment, economic growth and urbanization. The study employed a panel data regression on 136 countries with time frame of years 1990 to 2019. The model in this study deploys system GMM technique to estimate the model. The results show that financial development has a significant negative impact on energy consumption overall. Foreign direct investment and urbanization has significant impact on energy consumption. Also, economic growth positive impact on energy consumption its mean that economic growth promotes energy consumption. When dividing further the sample into different groups of regions such as Asian, European, African, North/Latin American and Caribbean countries then mixed results related to the nexus between financial development and energy consumption with respect to economic growth, urbanization and foreign direct investment. The policymakers in these different groups of countries must balance the relationship between energy supply and demand to achieving the sustainable economic development.

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