scholarly journals FDI, ECONOMIC FREEDOM AND ECONOMIC GROWTH OF NIGERIA

2021 ◽  
Vol 2 (2) ◽  
pp. 01-16
Author(s):  
J.O. Sekunmade
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Regression Analysis ◽  
Granger Causality ◽  
Direct Investment ◽  
Economic Freedom ◽  
Test Method ◽  
Series Data ◽  
Vector Autoregressive ◽  
The Impact

This paper investigates Foreign Direct Investment, Economic Freedom and Economic Growth of Nigeria between 1995 and 2018. Specifically, the data on: Foreign Direct Investment (FDI) inflows, Economic Freedom (Aggregate index) and the data on real gross domestic product (RGDP) were used during the analysis. Time-series data were tested for stationarity using the Augmented Dickey-Fuller Unit Root test method. Vector Autoregressive (VAR) estimation method was adopted to examine the effect of FDI, Economic Freedom on Economic growth. The interactive effect of FDI and Economic Freedom on Economic growth was determined using regression analysis while Granger Causality test method was adopted for determining the causality relationship among the variables. The result of the Vector Autoregressive (VAR) suggests that both FDI and Economic freedom do not have a significant effect on economic growth in Nigeria. The result of regression analysis shows that the joint coefficient of both FDI and EF is negative and not significant. The result of Granger Causality revealed that there is a uni-directional relationship between RGDP and FDI and between EF and FDI respectively. The research recommends that the federal government of Nigeria should adopt appropriate foreign trade strategies to enhance the impact of FDI on economic growth in Nigeria.

scholarly journals Foreign direct investment (FDI) and economic growth in China: vector autoregressive (VAR) analysis

2020 ◽  
Vol 80 ◽  
pp. 01002
Author(s):  
Pengfei Liu ◽  
Han-Sol Lee
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Chinese Economy ◽  
Series Data ◽  
Var Model ◽  
Fdi Inflows ◽  
Vector Autoregressive ◽  
Var Analysis ◽  
The Impact

This study examines the impact of foreign direct investment (FDI) on economic growth in China based on time series data for the period 1981-2018. For an empirical study, we used vector autoregressive (VAR) analysis. Before building our VAR model, we performed tests for unit root, normality, and heteroscedasticity to certify the data quality. The optimal lag 3 was selected using the Akaike information criterion (AIC), Schwartz (SC), and Hannan-Quinn (HQ) criteria. The Granger causality test is additionally performed. Based on the VAR model, we determined the impulse responses and variance decomposition of log FDI and log GDP in China. The results showed a positive and consistent impact of log FDI on China’s economic growth. The impact in the short-term is insignificant, as it is likely that there are multiple factors drive economic growth of China besides FDI inflows. However, the impact of FDI increases to a significant level in the long-term. Which indicates that FDI is one of the main factors to enhance Chinese economy. In conclusion, we suggest a policy implication how to sustain and promote the existing positive effects of FDI inflows on Chinese economy.

scholarly journals Examining the impact of Exports and Exchange rate on Economic Growth of Turkey

2020 ◽  
Author(s):  
Iftikhar Muhammad ◽  
Malik Shahzad Shabbir
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Exchange Rate ◽  
Granger Causality ◽  
Direct Investment ◽  
Economic Policies ◽  
Long Run ◽  
Short Run ◽  
Auto Regressive ◽  
The Impact

Abstract Purpose This study intends to analyze the long-run and short-run relationships along with the identification of causal links between exports, economic growth, and exchange rate in Turkey. Data/Design: This study uses auto-regressive distributed lags (ARDL) and Granger causality over time series monthly data from the year 2010–2018. The results indicate that exports are significantly positively related to economic growth while the exchange rate is found to be negatively related to economic growth. Findings: Moreover, findings from the test of Granger causality indicate that a unidirectional causal association is found from exports to foreign direct investment and economic growth and from economic growth to foreign direct investment. The Granger causality results indicate that an increase in exports accelerates the economic growth of Turkey and a change in growth rate and exchange rate leads to a change in foreign direct investment. Originality of work: The overall findings suggest that exports should be promoted along with the liberal-investment economic policies to boost the overall economic growth in Turkey.

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 Assessment of foreign direct investment, export and economic growth on the example of Kazakhstan

2016 ◽  
Vol 13 (4) ◽  
pp. 130-135 ◽  
Author(s):  
Tolkyn Azatbek ◽  
Altay Ramazanov
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Regression Analysis ◽  
Direct Investment ◽  
Jel Classification ◽  
Method Of Calculation ◽  
Correlation And Regression Analysis ◽  
Net Exports ◽  
The Republic ◽  
The Impact

The article considers the problem of estimating the communication of foreign direct investment, net exports and economic growth. As an example, the Republic of Kazakhstan is taken. Based on the method of calculation of the gross domestic product (GDP) expenditure and using the method of regression analysis, the impact of foreign direct investment (FDI) and net exports to GDP and interaction of FDI and net exports as components of GDP are evaluated. Keywords: investment, FDI, GDP, net exports, economic growth, correlation and regression analysis. JEL Classification: А10, C20, C35, E22, F37, F43

scholarly journals Impact of Trade Openness on Economic Growth: A Case Study of Pakistan'

2017 ◽  
Vol 3 (1) ◽  
pp. 57-68
Author(s):  
Rashid Ahmad ◽  
Kashif Raza ◽  
Sobia Saher
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Negative Impact ◽  
Trade Openness ◽  
Capital Formation ◽  
Fixed Capital ◽  
Series Data ◽  
Fixed Capital Formation ◽  
The Impact

Purpose: This paper estimates the impact of trade openness and economic growth in Pakistan by using time series data from period of 1975-2014. Econometric method was applied to estimate the impact of trade openness on economic growth. Gross fixed capital formation (proxy of investment), Foreign direct investment, Imports, Exports & trade openness (proxy of trade openness to check the volume of trade of a country) is used as explanatory variables while gross domestic product is treated as dependent variable in this study. Johansson co. integration approach developed by Johannes & Jeslius (1988) is used to evaluate the long run relationship among variables in this study. The results suggest that trade openness, imports, exports and foreign direct investment cast have positive impact on economic growth while on the other hand; gross fixed capital formation &labor force has negative impact on economic growth.

Impact of Globalization on Economic Growth in Vietnam: An Empirical Analysis

2018 ◽  
pp. 32-47 ◽  
Author(s):  
Dat Tho Tran ◽  
Van Thi Cam Nguyen
Keyword(s):  
Economic Growth ◽  
Time Series ◽  
Foreign Direct Investment ◽  
Exchange Rate ◽  
Empirical Analysis ◽  
Direct Investment ◽  
Time Series Data ◽  
Series Data ◽  
Balance Of Trade ◽  
The Impact

This study aims at investigating the impact of globalization on economic growth in the case of Vietnam. Empirical analysis is done by using time series data for the period from 1995 to 2014. The paper tested the stationary cointegration of time series data and utilized the error correction modeling technique to determine the short run relationships among economic growth, globalization, foreign direct investment, balance of trade and exchange rate variables. Then, the long run relationship between economic growth and the variables representing economic integration were estimated by ordinary least square. The results show that globalization, measured by the KOF index, promotes economic growth and Vietnam has gained from integrating into the global economy. The overall index of globalization had positively and significantly impacted the economic growth in Vietnam. The results also indicated that economic globalization had a significantly positive effect on economic growth in the period examined. The study further revealed that foreign direct investment and the exchange rate affect economic growth positively whereas balance of trade affects economic growth negatively.

The Impact of Foreign Direct Investment (FDI) on Economic Growth (EG) : Evidence from Djibouti

2021 ◽  
Vol 9 (10) ◽  
pp. 701-706
Author(s):  
Nashwa Maguid Hayel
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
International Development ◽  
Direct Investment ◽  
Time Series Data ◽  
Developed Countries ◽  
Least Square ◽  
Series Data ◽  
Study Results ◽  
The Impact

Abstract: The achievement of EG and development is considered the core objective for both Developing Countires (DCs) and Least Developed Countries (LDCs), so countries try to get adequate funding to achieve this goal through optimal macroeconomic policies and different strategies. Countries prefer other mechanisms with less burden and cost to achieve economic growth, such as FDI flows. International development-oriented institutions such as WB and IMF recommend and consider FDI flows are the most important factors of the modern technology transfer, management, and know-how, which is necessarily needed in the local investment projects in poor countries, so FDI represents optimal external sources of growth. The objective of this study is to explain the impact of FDI on the EG of Djibouti. To achieve this objective the study used a secondary annual time series data for the period 1985-2019 by the method of Ordinary Least Square (OLS). The study results showed that FDI in the case of Djibouti tends to be statistically insignificant effects and a limited impact on Djibouti‘s EG, Moreover,other factors such as the Human Development Index(HDI), and Gross Fixed Capital Formation(GFCF), Trade Openness(TOP) shows significant effects on the Gross Domestic Product (GDP). Finally, the Consumer Price Index (CPI) has no significance in the EG of Djibouti. The findings provide critical information to Djibouti policy decision-makers to make an informed decision with regard to attracting investment sectors and policies in encouraging foreign investors to invest in the country. KEYWORDS: Foreign Direct Investment, Economic Growth, Djibouti, Empirical Analysis.

scholarly journals The Impact of Foreign Direct Investment on Economic Growth in Nigeria

2015 ◽  
Vol 7 (4) ◽  
pp. 90-97
Author(s):  
Sani Ali Ibrahim
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Time Series Data ◽  
Empirical Studies ◽  
Trade Openness ◽  
National Income ◽  
Series Data ◽  
Long Run ◽  
The Impact

The economic development performance can be used to measure the economic growth of a given country. In economic analysis, a country can attain economic growth through the growth in national income measurement. However, there were rigorous discussions on the role of foreign direct investment (FDI) on economic growth and continued to be a topic of discussion on the contemporary economy. This paper serves as an extension to the previous empirical studies on the issue by providing some evidence from time series data for the period 1971 to 2013 of Nigeria. The primary aim of this study is to analyze the impact of FDI on economic growth of Nigeria taking trade openness, Gross Fixed Capital Formation and human capital as control variables. To investigate the long run equilibrium relationship, Johansen and Juselius co-integration approach is analyzed, while the speed of adjustment in the short run is analyzed through the use of VECM method. In Nigeria, FDI, GFCF and HK have long run relationship with economic growth. However, the coefficient of ECM in Nigeria is statistically significant at 1% level of significance. Thus, 10.8% of the adjustment is achieved due to the correction of the adjustment speed in a year.

On the foreign direct investment–economic growth relationship in Africa: does economic freedom mediate this relationship?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Olufemi Adewale Aluko ◽  
Muazu Ibrahim ◽  
Xuan Vinh Vo
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Economic Freedom ◽  
Empirical Literature ◽  
African Countries ◽  
Content Type ◽  
Economic Freedom Index ◽  
Bootstrap Algorithm ◽  
The Impact

PurposeIn this study, the authors examine how economic freedom mediates the impact of foreign direct investment (FDI) on economic growth in Africa.Design/methodology/approachBy using data from 41 countries over the period 2000–2017, the authors invoke Seo and Shin's (2016) sample splitting approach while relying on the recently developed Seo et al.'s (2019) computationally robust bootstrap algorithm to achieve the purpose of this study.FindingsThe authors find evidence of economic freedom threshold that bifurcates the link between FDI and economic growth in Africa. More precisely, FDI does not improve overall economic growth for African countries whose economic freedom index is below the estimated threshold while significantly spurring growth for African countries with economic freedom above this threshold.Practical implicationsAfrican countries need to strive towards improving their level of economic freedom through the strengthening of rule of law, reducing government size, promoting regulatory efficiency and further opening of the goods and capital markets.Originality/valueThe association between FDI and economic growth has been well documented. While the positive theoretical postulations are almost conclusive, empirical literature on the precise effect of FDI remains contentious and far from being settled. What is missing in the existing literature in Africa is whether countries' level of economic freedom mediates how FDI explains the variations in economic growth across African countries. The authors fill this research gap.

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