scholarly journals Does the WTO Accession Stimulate Inward FDI in Developing Countries? Accentuate on TRIMS, TRIPS or Trade Liberalization

2018 ◽  
Vol 8 (1) ◽  
pp. 277
Author(s):  
Md. Shakib Hossain
Keyword(s):  
Developing Countries ◽  
Human Capital ◽  
Foreign Direct Investment ◽  
Trade Liberalization ◽  
Financial Development ◽  
Direct Investment ◽  
Research Work ◽  
Market Size ◽  
Wto Accession ◽  
Macroeconomic Stability

The propensity of WTO always ensure to strengthening and consolidating the integration approach with country to country. Manifold accession like TRIMS, TRIPS and trade liberalization agenda facilitate to enlarge the attractiveness of foreign direct investment in many more developing countries. This study is concentrates on judgment of the WTO accession like liberalization, TRIMS and TRIPS stimulate the flow of FDI in developing countries and also to observe that the other relevant important variables such as macroeconomic stability, infrastructure, human capital, geographic location, financial development, agglomeration, market size has helped the incessant inflow of FDI for developing country. Some research penetratingly interpreted that TRIMS, TRIPS and trade liberalization accession are controversial subject matter for the developing countries. For accomplishing the research work the paper has used panel data of 58 different developing countries over the years 1990-2014. Through that work the paper has explore that because of the adopting liberalization polices, relinquishing market distortions with the connection of TRIMS and harmonization of IPR standards throughout TRIPS escalate the foreign direct investment in the developing countries, it means that there is a significant relationship of FDI along with TRIPS, TRIMs and trade openness. Other pertinent factors like market size, macroeconomic stability, agglomeration and engagement of WTO membership have also significant impact on FDI inflows. Others common factors like infrastructure, human capital, financial development, geographical location also make significant impact on facilitating foreign direct investment. Developing countries always requires strengthening their superiority and protecting rights and ensuring negotiation process and encouraging market liberalization process for accomplishing economic competitiveness.

scholarly journals Do Governance, Foreign Direct Investment and Human Capital Matter to Bolster Trade Liberalization? Fresh Insight from Developing Countries

2021 ◽  
Vol 7 (3) ◽  
pp. 325-341
Author(s):  
Muhammad Umar ◽  
Imran Sharif Chaudhry ◽  
Muhammad Faheem ◽  
Fatima Farooq
Keyword(s):  
Developing Countries ◽  
Human Capital ◽  
Foreign Direct Investment ◽  
Trade Liberalization ◽  
Direct Investment ◽  
Foreign Direct Investments ◽  
Lower Income ◽  
Middle Income ◽  
Middle Income Countries ◽  
The Impact

This study aims to explore the impact of governance, foreign direct investment and human capital on trade liberalization in developing countries (lower income, middle income and upper middle income). The study employed fixed effect for the period of 2000 to 2019. Results show governance, foreign direct investment and human capital are highly significant with trade liberalization in the case of lower-income countries. In the case of middle-income countries, empirical findings demonstrate governance and foreign direct investment are highly significant with a negative sign, while human capital has positive on trade liberalization. In the case of upper-middle-income countries, results show human capital and foreign direct investment affect positively, while governance has a negative effect on trade liberalization. On the behalf of results it is suggested that in the countries where human capital is high, most of the inflows of foreign direct investment happen. It means that the government can develop human resources to attract more foreign direct investments. The governments of developing countries should also concentrate on education, including training facilities and other quality educational facilities for human skill development.

scholarly journals The Dynamics of Foreign Direct Investment in BRICS Countries

2017 ◽  
Vol 9 (3(J)) ◽  
pp. 101-112
Author(s):  
Kunofiwa Tsaurai
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Foreign Direct Investment ◽  
Financial Development ◽  
Direct Investment ◽  
Fixed Effects ◽  
Trade Openness ◽  
Human Capital Development ◽  
Brics Countries ◽  
Capital Development

Recent studies which investigated the determinants of foreign direct investment (FDI) in BRICS include Hsin-Hong and Shou-Ronne (2012), Nandi (2012), Jadhav (2012), Darzini and Amirmojahedi (2013), Nischith (2013), Ho et al. (2013), Kaur et al. (2013) and Priya and Archana (2014). The findings from these studies shows lack of consensus and confirm that a list of agreeable determinants of FDI in BRICS countries is still an unsettled matter. This paper was therefore initiated in order to contribute to the debate on the discourse on FDI determinants in BRICS countries.This paper deviates from earlier similar studies in five ways: (1) uses most recent data, (2) is the first to investigate whether a combination of financial development, trade openness, human capital, economic growth and inflation influence FDI in BRICS countries, (3) uses different proxies of the variables that affect FDI, (4) employed both fixed effects and pooled ordinary least squares (OLS) approaches and (5) used a stacked data approach.The results of the study showed that economic growth, trade openness and exchange rate stability positively impacted on FDI, financial development positively influenced FDI under fixed effects, FDI was positively influenced by human capital development using the pooled OLS and inflation negatively affected FDI in line with literature. Taking into account these findings, this study urges BRICS to implement policies that increase financial sector efficiency and economic growth, maintain stable exchange rates, keep inflation rates at lower levels, enhance trade openness and human capital development in order to increase FDI inflows.

scholarly journals Growth and Infrastructure Development of Foreign Direct Investment in India

2018 ◽  
Vol 8 (3S) ◽  
pp. 280-284
Keyword(s):  
Human Capital ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Market Size ◽  
Infrastructure Development ◽  
Primary Reason ◽  
Infrastructural Development ◽  
Economic Framework ◽  
New Business ◽  
General Advancement

An outside direct venture (FDI) is an interest as an administering ownership in a business in single nation by a unit conventional in an alternate nation. Remote Direct speculation (FDI) is a most significant piece of an Indian Economic framework to build up the country. FDI plays an exceptional and developing job in worldwide business. The Foreign direct speculation viewed as the development, apparatus and hardware are the quick development and extension of the India. street and rail system is the essential piece of remote direct speculation and arrangements the market size, transportation, quality, political/financial solidness and unhindered commerce homes are the same old thing/venture atmosphere, Labor expenses and transparency. FDI assumes a fundamental job in the long haul advancement of a nation as a wellspring of capital as well as for improving appeal of the inward economy during exchange of innovation, combination framework, raising profitability and making new business openings. In India, FDI is estimated as a dynamic instrument, which aides in achieving independence in different subdivisions and in general advancement of the market. India has powerfully supported open interest in foundation as well as included private segment so as to give upgrade to the infrastructural development. Remote Direct Investment (FDI) is frequently observed as primary substances for monetary development in the creating nations like India. FDI contacts the monetary development by motivating residential venture, expanding human capital foundation and by help the innovation move in the assembly nations. The primary reason for this exploration study is to investigate the Growth and Infrastructure advancement of FDI on the financial development of India

scholarly journals The Nexus of Selected Macroeconomic Variables toward Foreign Direct Investment: Evidence from Indonesia

2021 ◽  
pp. 110-115
Author(s):  
Noris Fatilla Ismail ◽  
Suraya Ismail
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Domestic Investment ◽  
Fdi Inflows ◽  
Macroeconomic Variables ◽  
Distributed Lag ◽  
Long Run ◽  
Macroeconomic Stability

Foreign direct investment (FDI) inflows are a major instrument of economic growth in developing countries. Indonesia is one of the developing countries that has received more FDI with macroeconomic stability. The macroeconomic stability indicator is seen as an important factor in driving economic growth and attracting FDI inflows in Indonesia. Therefore, this study examines the relationship of selected macroeconomic variables toward the FDI in Indonesia over the period 1980-2019. Using Autoregressive Distributed Lag (ARDL), the empirical results showed that market size, domestic investment, government spending and foreign exchange rate are key factors influencing long-run FDI inflows. However, financial development revealed no relationship with FDI inflows in Indonesia. Overall findings indicated that macroeconomic variables influence FDI inflows. These findings guided policymakers in formulating new policies to ensure macroeconomic indicators' stability in driving economic growth.

scholarly journals Financial and Economic Factors Affecting Foreign Direct Investment - A Panel Estimation Study of the ASEAN-5 Countries

2021 ◽  
Vol 16 (3) ◽  
pp. 103-131
Author(s):  
Geetha Subramaniam ◽  
◽  
Ratneswary Rasiah ◽  
Doris Padmini Selvaratnam ◽  
Jayalakshmy Ramachandran ◽  
...  
Keyword(s):  
Foreign Direct Investment ◽  
Stock Market ◽  
Financial Development ◽  
Direct Investment ◽  
Trade Openness ◽  
Policy Implications ◽  
Market Size ◽  
Panel Estimation ◽  
Pooled Mean Group ◽  
Long Run

ASEAN's strength stems from its diversity, which generates a plethora of diverse market opportunities. Over the last few decades, Foreign Direct Investment (FDI) has risen significantly as a major source of international capital transfer, but the COVID-19 pandemic had a detrimental effect on FDI flows, with the outlook for ASEAN remaining highly unpredictable and contingent on the length of the crisis, the efficacy of policy efforts to encourage investment and to mitigate the economic consequences of the pandemic. This study examines the long-run relationships and short-run dynamic interactions between FDI and its determinants comprising of market size, trade openness, stock market capitalisation and financial development over the period 1970 to 2019. The study applies the dynamic heterogeneous panel estimation techniques of Mean Group (MG), Pooled Mean Group (PMG) and Dynamic Fixed Effects (DFE) to analyse a set of macro panel data of the ASEAN-5 countries, to establish the possible relationships between these variables. An analysis of the results reveals the existence of a long-run causality between FDI and its predictors, indicated by the significant error correction terms for the models tested in this study. There is evidence that market size and stock market capitalization significantly contribute to FDI, with market size being the most dominant contributor. Interestingly, the study also reveals that trade openness and financial development are not significant in determining FDI in the selected countries. The study concludes with an examination of policy implications and also sheds some light on the outlook of FDI in ASEAN-5 post Covid 19. Keywords: foreign direct investment, financial development, pooled mean group, ASEAN-5

scholarly journals The Dynamics of Foreign Direct Investment in BRICS Countries

2017 ◽  
Vol 9 (3) ◽  
pp. 101
Author(s):  
Kunofiwa Tsaurai
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Foreign Direct Investment ◽  
Financial Development ◽  
Direct Investment ◽  
Fixed Effects ◽  
Trade Openness ◽  
Human Capital Development ◽  
Brics Countries ◽  
Capital Development

Recent studies which investigated the determinants of foreign direct investment (FDI) in BRICS include Hsin-Hong and Shou-Ronne (2012), Nandi (2012), Jadhav (2012), Darzini and Amirmojahedi (2013), Nischith (2013), Ho et al. (2013), Kaur et al. (2013) and Priya and Archana (2014). The findings from these studies shows lack of consensus and confirm that a list of agreeable determinants of FDI in BRICS countries is still an unsettled matter. This paper was therefore initiated in order to contribute to the debate on the discourse on FDI determinants in BRICS countries.This paper deviates from earlier similar studies in five ways: (1) uses most recent data, (2) is the first to investigate whether a combination of financial development, trade openness, human capital, economic growth and inflation influence FDI in BRICS countries, (3) uses different proxies of the variables that affect FDI, (4) employed both fixed effects and pooled ordinary least squares (OLS) approaches and (5) used a stacked data approach.The results of the study showed that economic growth, trade openness and exchange rate stability positively impacted on FDI, financial development positively influenced FDI under fixed effects, FDI was positively influenced by human capital development using the pooled OLS and inflation negatively affected FDI in line with literature. Taking into account these findings, this study urges BRICS to implement policies that increase financial sector efficiency and economic growth, maintain stable exchange rates, keep inflation rates at lower levels, enhance trade openness and human capital development in order to increase FDI inflows.

The contribution of human capital to foreign direct investment inflows in developing countries

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Ali Abbas ◽  
Imad Moosa ◽  
Vikash Ramiah
Keyword(s):  
Developing Countries ◽  
Human Capital ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Statistical Significance ◽  
Regression Equation ◽  
Basic Question ◽  
Content Type ◽  
Extreme Bounds Analysis ◽  
Determinants Of Fdi

PurposeThis paper is about the effect of human capital on foreign direct investment (FDI). The purpose of this paper is to find out if developing countries with high levels of human capital (educated people and well-trained labour force) are more successful in attracting FDI. The underlying hypothesis has been tested repeatedly without reaching a consensus view or providing an answer to the basic question. This is to be expected because FDI is determined by a large number of factors, making the results sensitive to the selected set of explanatory variables, which forms the basis of the Leamer (1983) critique of the use of multiple regression to derive inference. Furthermore, confirmation bias and publication bias entice researchers to be selective in choosing the set of results they report.Design/methodology/approachThe technique of extreme bounds analysis, as originally suggested by Leamer (1983) and modified by Sala-i-Martin (1997), is used to determine the importance of human capital for the ability of developing countries to attract FDI. The authors use a cross-sectional sample covering 103 developing and transition countries.FindingsThe results show no contradiction between firms seeking human capital and cheap labour. No matter what proxy is used to represent human capital, it turns out that the most important factor for attracting FDI is the variable “employee compensation”, which is the wage bill, implying that multinational firms look for cheap and also skilled labour in the host country.Originality/valueIn this paper, the authors follow the procedure prescribed by Leamer (1983), and modified by Sala-i-Martin (1997), using extreme bounds analysis to distinguish between robust and fragile determinants of FDI, with particular emphasis on human capital. Instead of deriving inference from one regression equation by determining the statistical significance of the coefficient on the variable of interest, the extreme bounds or the distribution of estimated coefficients are used to distinguish between robust and fragile variables. This means that emphasis is shifted from significance, as implied by a single regression equation, to robustness, which is based on a large number of equations. The authors conduct tests on three proxies for human capital to find out if they are robust determinants of FDI and also judge the degree of robustness relative to other determinants.

Sign in / Sign up

Export Citation Format

Share Document