Does Foreign Direct Investment Generate Economic Growth? A New Empirical Approach Applied to Spain

Carbonell, Jorge Bermejo; Werner, Richard A.

doi:10.1080/00130095.2017.1393312

Cited by 174 publications

(84 citation statements)

References 103 publications

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“…The test of endogeneity shows that the null hypothesis of specified endogenous variable can be treated as exogenous is rejected at p < 0.05. Many prior studies have employed the lagged value of supposed endogenous covariate as an appropriate instrument [13,80]. Table 8 shows that our main results in benchmark estimation (Model 5 in Table 4) remain consistent across all three estimators.…”

Section: Robustness Testssupporting

confidence: 56%

Foreign Direct Investment, Natural Resources, Economic Freedom, and Sea-Access: Evidence from the Commonwealth of Independent States

Kasimov

Karimov

et al. 2020

Sustainability

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This study examines the importance of natural resources, economic freedom, and sea-access in attracting foreign direct investment (FDI) inflows to the Commonwealth of Independent States (CIS), using panel data from 1998 to 2017. The Prais-Winsten regression with panel-corrected standard errors (PCSEs) is employed for all estimations. Feasible Generalized Least Squares (FGLS), Random Effects with Driscoll-Kraay standard errors (RE (D-K)), and Random Effects of Generalized Least Squares (RE (GLS)) estimators are used to test the sensitivity of PCSEs’ estimates to changes in the underlying empirical model, whereas Instrumental Variables with Two Stage Least Squares (IV (2SLS)), Limited Information Maximum Likelihood (LIML), and Baltagi’s Two-Stage Least-Squares Random-Effects (IV (EC2SLS)) estimators are used to address potential endogeneity concerns. The estimates confirm that natural resources, economic freedom, and sea-access are robust and decisive factors affecting FDI location decisions of foreign investors in CIS. More precisely, the results suggest that increased revealed comparative advantage in petroleum, higher economic freedom characterized by the increased government size and open markets, and territorial coastlines have a statistically significant and positive effect on FDI inflows to CIS transition economies. We also find that direct access to the Black Sea and the Caspian Sea provides a significant geographic competitive advantage to Azerbaijan, Kazakhstan, Georgia, Russia, Turkmenistan, and Ukraine in attracting FDI inflows over the other CIS member-states.

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Section: Robustness Testssupporting

confidence: 56%

Foreign Direct Investment, Natural Resources, Economic Freedom, and Sea-Access: Evidence from the Commonwealth of Independent States

Kasimov

Karimov

et al. 2020

Sustainability

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“…As posited by Easterly (1999), and recently applied by Tang et al (2018), Bermejo Carbonell andWerner (2018), van der Merwe and Dodd (2019), Harrod-Domar growth model has been employed in international financing institutions (IFIs). Chenery and Strout (1966) gave the definitive statement of the Financing Gap model in their Two-Gap model that aid will "fill the temporary gap between investment ability and saving ability".…”

Section: Harrod-domar (Hd) Model and Financing Gap Measurementmentioning

confidence: 99%

Estimating financing gaps in rice production in Southwestern Nigeria

Ojo

Ogundeji

Babu

et al. 2020

Economic Structures

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Rice is one of the most valuable cereal crops cultivated and consumed all over the world. It is a staple food in several African counties, Nigeria as an example and constitutes a large portion of the diet on a regular basis (Lu et al. 2018). Rice is cultivated in mostly all agro-ecological zones in Nigeria but on a relatively small scale. As asserted by FAO (2015), Nigeria is the continent's leading consumer of rice, one of the largest producers of rice in Africa and simultaneously one of the largest rice importers in the world. Rice is an important food security crop, it is an essential cash crop for it is AbstractThis study analysed the financing gaps relative to production frontier of rice farmers in Southwestern Nigeria. A multistage sampling technique was used to collect crosssectional data from 360 rice farmers selected from three states in the region. A Cobb-Douglas stochastic frontier and an adapted form of Harrod-Domar (HD) growth model was employed to determine the financing gap required the farmers to be at the frontier level. The empirical results of the frontier model show that quantity of labour, quantity of rice as planting material and herbicides were statistically significant in explaining the variations in the efficiency of rice production in Nigeria. However, age, gender, farming experience, household size, access to credit, access to information, adoption of improved variety and location of rice farmers as sources of technical inefficiencies. As revealed by the result of the HD growth model, the average amount of credit per season that farmers had access to was, 38,630.56 naira (₦) while the mean financing in the form of credit required to produce at the frontier level was ₦193,626.50, showing a financing shortfall of about 80%. As unravelled by the result of the study, it can thus be concluded that technical efficiency of rice farmers can be improved by ameliorating access to timely credit and agricultural information for improving rice productivity. These findings suggest that filling the financing gap of smallholder rice farmers will improve rice productivity in Nigeria. The study, therefore, recommends that strengthening the existing technology by building farmers' capacity on farm management practices would be the surest means of improving rice productivity growth in Nigeria. This would not only contribute to the intensification of rice production in Nigeria to meet its increasing rice demand, but also improve rice farmers' productivity and their households' incomes.

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“…Studies from several works point out FDI as an essential factor for economic growth. Positive and significant relationship exists among GDP and FDI (Bermejo Carbonell & Werner, 2018;Borensztein, De Grgorio, & Lee, 1995;Gudaro, Chhapra, & Sheikh, 2012). This means that a rise in FDI inflows portends great enhancement in the growing of an economy.…”

Section: Theoretical Framework and Hypothesis Developmentmentioning

confidence: 99%

The Effect of International Financial Reporting Standards on the Association between Foreign Direct Investment and Economic Growth: Evidence from Selected Countries in Africa

Prah

2020

Journal of Accounting, Business and Finance Research

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The study aims at examining how IFRS adoption influences the relationship existing among foreign direct investment (FDI) and economic growth. The data consist of 12 developing economies that are the highest recipients of FDI in Africa, and the years of study are from 1996-2018. Using Ordinary Least Square and Generalized Least Square method of estimation, the result shows that IFRS is significantly positive to FDI. With FDI inflows in these countries, the result provides evidence that Non fully-IFRS adopted countries experience higher inflows of FDI than the fully-IFRS adopted countries. We find FDI inflows to also have positive influence on economic growth. The interaction of FDI and IFRS also influences economic growth positively when further analysis was carried on. The results provide evidence of positive relation among FDI, IFRS, and economic growth. IFRS adoption promotes FDI inflows which consequently spurs economic growth. There is, therefore, the need for policymakers to ensure adoption and enforcement of IFRS.

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Does Foreign Direct Investment Generate Economic Growth? A New Empirical Approach Applied to Spain

Cited by 174 publications

References 103 publications

Foreign Direct Investment, Natural Resources, Economic Freedom, and Sea-Access: Evidence from the Commonwealth of Independent States

Foreign Direct Investment, Natural Resources, Economic Freedom, and Sea-Access: Evidence from the Commonwealth of Independent States

Estimating financing gaps in rice production in Southwestern Nigeria

The Effect of International Financial Reporting Standards on the Association between Foreign Direct Investment and Economic Growth: Evidence from Selected Countries in Africa

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