scholarly journals Impacts of Foreign Direct Investment on Economic Growth: Empirical Evidence from Australian Economy

2017 ◽  
Vol 9 (5) ◽  
pp. 121 ◽  
Author(s):  
Viral Pandya ◽  
Sommala Sisombat
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Export Performance ◽  
Policy Decision ◽  
Decision Makers ◽  
Fdi Inflows ◽  
Australian Economy ◽  
The Relationship ◽  
Poor Relationship

This paper examines foreign direct investment (FDI) inflows and its impact on economic growth in Australia. FDI inflows are considered to be a vital source of economic growth or development for any economy and it plays big role in growth in gross domestic product (GDP), improvement in infrastructure, employment creation, export and trade performance. This paper examines the relationship between FDI and economic growth of Australia through regression analysis between FDI and different measures of economic growth. The multiple regressions is used to derive conclusion on importance of FDI. The results highlight that FDI inflows contribute to the Australian economy including a growth in GDP, export performance and employment. Mining and quarrying has been identified as an attractive sector in which it has contributed to 7% of GDP, a large amount of capital has been invested and employed intensive labor. The result reflects absence of relationship between FDI and economic growth of Australia as two out three variables shows poor relationship with FDI. The findings provide critical information to Australian policy decision makers to make an informed decision with regard to attractive investment sectors and policies in encouraging foreign investors to invest in the country.

scholarly journals Agricultural Sector FDI and Economic Growth in Saarc Countries

2019 ◽  
Vol 8 (2S10) ◽  
pp. 116-121
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Agricultural Sector ◽  
South Asians ◽  
Secondary Data ◽  
Agricultural Products ◽  
Fdi Inflows ◽  
Important Relationship ◽  
The Relationship

The study seeks to establish the relationship between foreign direct investment to Saarc region agricultural sector and economic growth with secondary data. SAARC comprises 3% of the world's area, 21% of the world's population and 3.8% (US$2.9 trillion) making up a total of 3% of the world’s area. The country has second in all over the world in terms of agriculture position. The population obliquely all of the member states is over 1.7 billion, accounting for 21% of the world’s total population. In their 42% of the agricultural operation in SAARC nations and also 51% source of livelihood of the South Asians. The study has revealed that India alone accounts for 52 per cent of the agricultural products using the SAARC region peoples. For the present study, a total of 34 groups related to the agricultural products were selected out of the total groups. The techniques employed to analyze the data include descriptive statistic, correlation and linear forecast method. The study also revealed a positive and important relationship between economic growth and foreign direct investment flow to the agricultural sector. Thus, the study recommends that policy should focus on flexible trade policies to attract more foreign direct investment (FDI) inflows to SAARC nations. i.e. Afghanistan, Bangladesh, Bhutan, Maldives, Nepal, Pakistan, Sri Lanka including India

scholarly journals Empirical Research on the Relationship amongst Renewable Energy Consumption, Economic Growth and Foreign Direct Investment in Kazakhstan and Uzbekistan

Energies ◽  
2021 ◽  
Vol 14 (2) ◽  
pp. 332
Author(s):  
Janusz Grabara ◽  
Arsen Tleppayev ◽  
Malika Dabylova ◽  
Leonardus W. W. Mihardjo ◽  
Zdzisława Dacko-Pikiewicz
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Renewable Energy ◽  
Energy Consumption ◽  
Direct Investment ◽  
Renewable Energy Sources ◽  
Energy Sources ◽  
Renewable Energy Consumption ◽  
Integration Test ◽  
The Relationship

In this contemporary era, environmental problems spread at different levels in all countries of the world. Economic growth does not just depend on prioritizing the environment or improving the environmental situation. If the foreign direct investment is directed to the polluting industries, they will increase pollution and damage the environment. The purpose of the study is to consider the relationship between foreign direct investment in Kazakhstan and Uzbekistan and economic growth and renewable energy consumption. The study is based on data obtained from 1992 to 2018. The results show that there is a two-way link between foreign direct investment and renewable energy consumption in the considered two countries. The Granger causality test approach is applied to explore the causal relationship between the variables. The Johansen co-integration test approach is also employed to test for a relationship. The empirical results verify the existence of co-integration between the series. The main factors influencing renewable energy are economic growth and electricity consumption. To reduce dependence on fuel-based energy sources, Kazakhstan and Uzbekistan need to attract energy to renewable energy sources and implement energy efficiency based on rapid progress. This is because renewable energy sources play the role of an engine that stimulates the production process in the economy for all countries.

scholarly journals Dynamic Causal Relationships among GDP, Exports, and Foreign Direct Investment (FDI) in the Developing Countries

2013 ◽  
Vol 14 ◽  
pp. 1-19 ◽  
Author(s):  
Mohsen Mehrara ◽  
Amin Haghnejad ◽  
Jalal Dehnavi ◽  
Fereshteh Jandaghi Meybodi
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Foreign Direct Investment ◽  
Strong Evidence ◽  
Direct Investment ◽  
The Other ◽  
Fdi Inflows ◽  
Long Run ◽  
Short Run ◽  
Growth Hypothesis

Using panel techniques, this paper estimates the causality among economic growth, exports, and Foreign Direct Investment (FDI) inflows for developing countries over the period of 1980 to 2008. The study indicates that; firstly, there is strong evidence of bidirectional causality between economic growth and FDI inflows. Secondly, the exports-led growth hypothesis is supported by the finding of unidirectional causality running from exports to economic growth in both the short-run and the long-run. Thirdly, export is not Granger caused by economic growth and FDI inflow in either the short run or the long run. On the basis of the obtained results, it is recommended that outward-oriented strategies and policies of attracting FDI be pursued by developing countries to achieve higher rates of economic growth. On the other hand, the countries can increase FDI inflows by stimulating their economic growth.

scholarly journals Determinant of FDI Inflows in OIC Countries

2021 ◽  
Vol 4 (1) ◽  
Author(s):  
Tania Megasari ◽  
Samsubar Saleh
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Exchange Rates ◽  
Direct Investment ◽  
Trade Openness ◽  
Political Stability ◽  
Fixed Effect Model ◽  
Fdi Inflows ◽  
Macroeconomic Variables ◽  
Effect Model

This study aims to analyze the determinants of foreign direct investment (FDI) in the Organization of Islamic Cooperation (OIC) country members for the period 2005 to 2018 The determinant variables of FDI are corruption, political stability and macroeconomic variables such as inflation, exchange rates, economic growth, and trade openness. Analysis used in the study  is the fixed effect model (FEM) of the OIC data panel.The results showed that economic growth and trade openness had a significant influence on foreign direct investment (FDI), while the effects of corruption, political stability, inflation and the exchange rate have no significant effect on foreign direct investment (FDI).

scholarly journals A time series analysis of determinants of FDI in Afghanistan: Which one matters the most, security or economic growth?

2018 ◽  
Vol 6 (2) ◽  
pp. 19
Author(s):  
Abdul Fareed Delawari
Keyword(s):  
Economic Growth ◽  
Time Series ◽  
Foreign Direct Investment ◽  
Time Series Analysis ◽  
Direct Investment ◽  
Economic Factors ◽  
Market Economic ◽  
The Government ◽  
The Relationship

Afghanistan has been practicing market economic system since 2002. Since then, the government has been initiating different policies and announced various incentives to attract foreign direct investment (FDI) to the country. However, the outcome has not been satisfactory due to several political and economic factors. This paper explores the relationship between security, economic growth and FDI in Afghanistan, using ARDL model. The paper covers a period from 2002 to 2016. The empirical results of this study show that there is a negative long-term relationship between security and FDI. Hence,  the author concludes that, to attract FDI to the country, insuring security should be the top priority of the government of Afghanistan.

scholarly journals Aid for Trade Flows and Recipient-Countries’ Integration into the World Market for Services Exports: Do Merchandises Exports and Foreign Direct Investment Inflows Matter?

2020 ◽  
pp. 2350001 ◽  
Author(s):  
Sena Kimm Gnangnon ◽  
Susana Del Mar Ramirez Ramirez
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Export Performance ◽  
World Market ◽  
Fdi Inflows ◽  
Performance Effect ◽  
The World ◽  
Aid For Trade ◽  
The Empirical Analysis ◽  
Positive Effect

An important literature on the recipient-countries’ export performance effect of Aid for Trade (AfT) flows has focused on the goods side. The few existing studies on the services exports effects of AfT interventions have reached mixed results, reflecting a positive or weak effect. This study aims to complement these few studies by examining the effect of AfT flows on recipient-countries’ share of services exports in the world services exports (‘services export integration’), including through two main channels: their share of merchandises exports in the world merchandises exports (‘merchandises export integration’) and the size of Foreign Direct Investment (FDI) inflows. The empirical analysis, based on a sample of 105 countries over the period 2002–2016, has shown that these two channels definitely matter for the effect of AfT flows on countries’ services export integration. Specifically, by fostering countries’ merchandises export integration, AfT flows can promote their services export integration. Furthermore, promoting FDI inflows enhances the positive effect of AfT flows on countries’ services export integration.

scholarly journals Impact of Foreign Direct Investment Inflows on Economic Growth; the Case of the Republic of Seychelles

2019 ◽  
Author(s):  
Yusheng Kong ◽  
Sampson Agyapong Atuahene ◽  
Geoffrey Bentum-Mican ◽  
Abigail Konadu Aboagye
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Least Square ◽  
Small Island ◽  
Host Countries ◽  
Fdi Inflows ◽  
Economic Trends ◽  
The Republic ◽  
The Impact

This paper aims to research whether there is link between FDI inflows and Economic growth in the Republic of Seychelles Island. The ordinary least square results obtained shows that in the impact of FDI inflows on economic growth is low. Small Island Developing States attracts less FDI inflow because they are limited to few resources that attracts overseas firms which results in retarded development. The research lighted that impact of foreign direct investment on host countries does not only depend on the quality and quantity of the FDI inflows but some other variables such as the internal policies and the management skills, market structures, economic trends among others.

scholarly journals An Evaluation of Relationship between Foreign Direct Investment and Economic Growth in Vietnam

2014 ◽  
Vol 220 ◽  
pp. 79-96
Author(s):  
Anh Phạm Thị Hoàng ◽  
Thu Lê Hà
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Significant Contribution ◽  
Foreign Capital ◽  
Positive Impact ◽  
National Economic ◽  
Investment Law ◽  
The Relationship

Foreign direct investment (FDI) is an essential source of capital in the gross investment conducive to national economic growth, including the case of Vietnam. Since the 1987 Foreign Investment Law, the country has attracted a large amount of foreign capital, which makes a significant contribution to economic development. This research employs a VAR model to analyze the relationship between FDI and Vietnam’s economic growth. The results suggest that FDI has a positive impact on the latter and vice versa. The research also finds that FDI stimulates export and improves the quality of human resources and technology - important prerequisites for the economic growth.

Do surges in foreign direct investment inflows lead to surges in economic growth? Evidence from developing countries

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Jagadish Prasad Sahu
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Domestic Investment ◽  
Fdi Inflows ◽  
Content Type ◽  
Regression Methods ◽  
Recursive Bivariate Probit ◽  
Rapid Economic Growth

Purpose The purpose of this paper is to examine whether surge in foreign direct investment (FDI) inflows leads to surge in economic growth in 52 developing countries for the period 1990-2014. Design/methodology/approach The author used a threshold approach to identify surge incidences in gross domestic product (GDP) per capita growth rates and FDI inflows (measured as percentage of GDP) for each country included in the sample. Three different criteria are used to identify surge instances. As a preliminary analysis the author used the probit and complementary log–log regression methods to estimate the likelihood of growth surge occurrence. To correct the potential endogeneity problem the author jointly estimated the growth surge and FDI surge equations using the recursive bivariate probit (RBP) regression. Findings The author found that East Asia and the Pacific region has highest rate of growth surge incidences followed by South Asia. The results suggest that surge in FDI inflows significantly increases the likelihood of growth surge. The finding is robust to alternative surge definitions and methods of estimation. Practical implications The analysis reveals that inbound FDI flow is a critical driver of economic growth in developing countries. Large FDI inflows matters for achieving rapid economic growth. Therefore developing countries should adopt favourable policies to attract more FDI. Policymakers should focus on improving the investment climate of the country to boost domestic investment and to attract larger amount of FDI into the economy. Originality/value To the best of the author’s knowledge this is the first study to examine whether surge in FDI inflows stimulates surge in economic growth in developing countries. The analysis reveals that FDI surge is a robust predictor of rapid economic growth in developing countries.

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