Impact of Foreign Direct Investment on Stock Market Growth in Nigeria

2016 ◽  
Vol 1 (2) ◽  
pp. 1-14
Author(s):  
Odo Idenyi ◽  
Anoke Ifeyinwa ◽  
Nwachukwu Obinna ◽  
E Promise
Keyword(s):  
Foreign Direct Investment ◽  
Stock Market ◽  
Direct Investment ◽  
Market Growth

scholarly journals Does Monetary Policy and Foreign Direct Investment Have an Influence on the Performance of Stock Market: Further Empirical Evidence from Ghana

2020 ◽  
Vol 2 (2) ◽  
pp. 161-176
Author(s):  
Opoku Adabor ◽  
Emmanuel Buabeng
Keyword(s):  
Monetary Policy ◽  
Foreign Direct Investment ◽  
Stock Market ◽  
Direct Investment ◽  
Market Performance ◽  
Empirical Literature ◽  
Long Run ◽  
Stock Market Performance ◽  
Short Run ◽  
Positive Effect

Monetary policy, foreign direct investment, and the stock market continue to dominate in discussions in developing countries. However, the linkage between the three variables in empirical literature remains unclear. This study aims to test two separate hypotheses: Firstly, the study examines the effects of monetary policy on stock market performance in Ghana. Secondly, the study also empirically investigates the effect of foreign direct investment on stock market performance in Ghana. Autoregressive Distributed Lag (ARDL) model was employed as an estimation strategy to examine the short and long-run effects using annual time series data from 1990 to 2019. The study revealed that monetary policy rate and money supply exerts a statistically significant negative and a positive effect on stock market performance in both the long and short-run in Ghana, respectively. It was also found that foreign direct investment has significant and a positive effect on stock market performance in Ghana in both the long and short run. Total capital stock and volume traded were also found to exert significant positive and negative impacts on stock market performance both in the short and long run respectively. Based on our findings, we recommend that expansionary monetary policy will be a better option to be carried out to improve the stock market performance in Ghana. Furthermore, government and private partnership may ensure the effective management of the macroeconomic variables to attract foreign direct investment into Ghana to boost stock market performance.

THE NEXUS BETWEEN ECONOMIC GROWTH, STOCK MARKET DEPTH, TRADE OPENNESS, AND FOREIGN DIRECT INVESTMENT: THE CASE OF ASEAN COUNTRIES

2019 ◽  
Vol 64 (03) ◽  
pp. 461-493 ◽  
Author(s):  
RUDRA P. PRADHAN ◽  
MAK B. ARVIN ◽  
JOHN H. HALL
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Stock Market ◽  
Mutual Fund ◽  
Direct Investment ◽  
Trade Openness ◽  
Market Depth ◽  
Long Run ◽  
Asean Countries ◽  
Tax Holidays

Many studies have investigated the causal relationship between economic growth and the depth in the stock market, between economic growth and trade openness, or between economic growth and foreign direct investment. Advancing on earlier work, this paper uses vector error-correction and cointegration techniques in order to establish whether there is a long-run equilibrium relationship between all four variables. We consider a sample of 25 ASEAN Regional Forum (ARF) countries which are studied over the period 1961–2012. Our analysis, which combines various strands of the literature, establishes the direction of causality between the variables. Policy recommendations include the encouragement of mutual fund investment by smaller investors to increase stock market depth as well as methods to increase foreign direct investment, such as tax holidays.

scholarly journals EU-COUNTRY AND NON-EU-COUNTRY AT THE TIME OF CRISIS: FOREIGN DIRECT INVESTMENT

2020 ◽  
Vol 6 (3) ◽  
pp. 19-23
Author(s):  
Helga Kristjánsdóttir ◽  
◽  
Stefanía Óskarsdóttir ◽  
Keyword(s):  
Foreign Direct Investment ◽  
Financial Crisis ◽  
Stock Market ◽  
Direct Investment ◽  
Global Financial Crisis ◽  
Economic Consequences ◽  
Portfolio Investment ◽  
Broad Perspective ◽  
Economic Wealth ◽  
Positive Effects

The global financial crisis affected the flows of foreign direct investment (FDI). This study focuses on two countries in the midst of the financial crisis: Iceland with IMF backup, and Ireland with ECB backup. The research focus is on the situation from the broad perspective of international economics and political atmosphere, combining government decisions with economic consequences. We analyze inward foreign direct investment, incorporating factors like economic size and stock market firms, receiving portfolio investment, rather than FDI. Our findings indicate that before the crisis the economic wealth in the domestic market to have positive effects on FDI, and firms receiving portfolio investment on the stock market are competing with FDI. This is the case for both Ireland and Iceland. However, after the crisis, these factors have insignificant impact on FDI.

scholarly journals Macroeconomic Influence on the Nepalese Stock Market

2019 ◽  
Vol 31 (1) ◽  
pp. 47-64
Author(s):  
Mukti Bahadur Khatri
Keyword(s):  
Foreign Direct Investment ◽  
Exchange Rate ◽  
Interest Rate ◽  
Stock Market ◽  
Money Supply ◽  
Stock Prices ◽  
Economic Activity ◽  
Direct Investment ◽  
Negative Relationship ◽  
Short Run

This study examines the dynamic relationship among the stock market and macroeconomic factors such as nominal domestic variables (inflation, money supply, and interest rate), real economic activity (gross domestic product) and foreign variable (exchange rate and foreign direct investment) of Nepal. It has used Johansen and Juselius (1990) method of multivariate cointegration for the period Mid-July 1994 to Mid-July 2015. The finding of this study shows that the stock prices are positively and significantly related to money supply. Real economic activity and interest rate have insignificant and negative relationship with the stock prices. Similarly, foreign direct investment, inflation (CPI) and exchange rate with US dollar have a positive and insignificant relationship with the Nepalese stock market. Accordingly, the VEC estimates suggest that there is no significant effect of macroeconomic variables to the Nepalese stock price in the short run. In general, the presence of cointegration and causality suggest that Nepalese stock market is not efficient in both the short run and the long run.

scholarly journals The Impact of Second Generation FDI Reforms on the Stock Market Development in India

2019 ◽  
Vol 8 (3) ◽  
pp. 8080-8087
Keyword(s):  
Foreign Direct Investment ◽  
Standard Deviation ◽  
Stock Market ◽  
Direct Investment ◽  
Structural Breaks ◽  
Second Generation ◽  
Terms Of Trade ◽  
Market Development ◽  
Stock Market Development ◽  
The Impact

The Governments took a series of initiatives as a measure of second-generation reforms in Foreign Direct Investment (FDI). The FDI reform initiatives had started since 1991 as foundation of Indian economy and the governments over the period contributed to emerge India as destination for Foreign Direct Investment in the world. These reforms played an important role in capital formation in stock markets and developments in the economy. This paper attempts to study the impact of second-generation economic reforms in FDI and its impact on Stock Market Development (SMD) in India. This paper uses a multivariate unrestricted VAR (Vector Autoregression) model to investigate the impact of the reforms in FDI on the development of stock market in India. The study used the quarterly data of FDI inflow, exchange rates and terms of trade (Exports/Imports) from 2004 to 2017 to find the long run impact of FDI reforms on the SMD. The SMD is the ratio of stock market capitalization to the Gross Domestic Product (GDP) of the country. The study uses the unrestricted VAR to generate impulse responses to find the impact of one standard deviation innovation change in one variable on other. Further, Unit Root Test, Granger causality test statistics and variance decomposition (VDC) respectively have been applied to identify variables stationarity, the causality and percent change in variance due to one standard deviation innovation in other variable. The findings of the study conclude that there were structural breaks in the data during 2007Q1 and 2011Q1 due to US financial crisis that lead to high volatility in the Indian stock market. Further, finding concluded that there is a bidirectional causality between foreign direct investment and the stock market development. Finally, study revealed that FDI and terms of trade are also having a bidirectional causality where shock in terms of trade brings a change of 25.15 percent in FDI inflows

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