Does Foreign Direct Investment Promote Economic Growth? Evidence From East Asia and Latin America

Zhang, Kevin Honglin

doi:10.1111/j.1465-7287.2001.tb00059.x

Cited by 392 publications

(177 citation statements)

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“…Before proceeding for the Cointegration test, the econometric methodology says all the suggested variables in the model must be integrated in order I(1). Fowowe (2011) described that after testing the unit root there are two ways of testing the causality (i) the first condition is that when the variables are integrated in order I(1) and Cointegrated then the VECM is the best choice to be used, see also (Emirmahmutoglu & Kose, 2011;Fowowe, 2011;Moudatsou & Kyrkilis, 2011;Zhang, 2001) the (ii) way is that if the proposed variables are not integrated in the same order then the causality should be proceed by the VAR approach, see also (Fowowe, 2011;Toda & Phillips, 1993). But before going to the empirical analysis of a detailed summary of the proposed variables in Table 1.…”

Section: Data and Estimation Strategymentioning

confidence: 99%

Does Foreign Direct Investment Lead to Economic Growth? Evidences from Asian Developing Countries

Ali¹,

Mingque²

2018

IJEF

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The study about the interrelationship between FDI and economic growth in the host country is one of the hottest discussions. Some of the studies have evidence and consider FDI as the growth driver and some others don't. This study attempted to scrutinize the causal association of FDI with GDP in Indonesia, India, Malaysia and Bangladesh for the years of 1990 to 2014. Cointegration test has been applied in this study which shows that there is a long-term interrelationship within FDI and economic growth and then applied the Granger causality (GC) test which is based on the VECM. The short run results show that there are no evidence of causality direction from FDI to GDP and vice versa, whereas the long run results show that there is a positive impact of FDI and other variables to the GDP but not significant, and from GDP and other variables to FDI there is a negative interrelationship but significant. The results show the ambiguous interrelationship between FDI and economic growth.

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Section: Data and Estimation Strategymentioning

confidence: 99%

Does Foreign Direct Investment Lead to Economic Growth? Evidences from Asian Developing Countries

Ali¹,

Mingque²

2018

IJEF

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“…A panel analysis of developing countries by Lipsey [34] showed that the interaction effect between FDI and education level in the previous period (t-1) had a crucial impact on economic growth. Zhang [35], in a study of eleven developing countries in East Asia and South America, demonstrated that FDI, trade liberalization, export orientation, and human capital have important effects on economic growth. Durham [36] reported that FDI differs depending on the absorption capacity of a host country.…”

Section: Literature Reviewmentioning

confidence: 99%

The Nexus of FDI, R&D, and Human Capital on Chinese Sustainable Development: Evidence from a Two-Step Approach

Park

2018

Sustainability

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This study examines the effect of the foreign direct investment (FDI)-human capital and R&D-human capital interactions (FDIHC and RDHHC) on Chinese development between 1991 and 2015. Based on endogenous growth theory, the study focuses on FDI, R&D, and human capital as important factors for sustained economic growth; the interactions among factors are set as the main variables affecting economic growth (GDP). In particular, this study attempts a two-step empirical analysis. First, data mining and semantic network analysis (SNA) are performed using variables as keywords; reliability and realism are reflected as variables. Second, using the vector error correction model (VECM), the study analyzes short and long run mutual influences between variables. The results show that, in data mining and SNA with FDI and R&D as keywords, words related to human capital show high frequency, centrality, and clustering. This finding implies that FDIHC and RDHHC have robustness as variables and can be used as interaction variables. According to the VECM results, FDIHC and RDHHC have positive influences on GDP in the short and long run. The results of a variance decomposition test show that RDHHC has strong mid-to long-run impacts on GDP, FDIHC, and R&D itself.

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“…The second phase comes with reforms in the regulatory environment, creating a less uncertain investment climate, opening the door for foreign resources. As a consequence, the amount of foreign direct investment has increased substantially (Mortimore, 2000;Treviño, Thomas, & Cullen, 2008;Zhang, 2001), in particular from North American firms (Tuman & Emmert, 2004). Capital inflow into Latin America also happens through the growing number of firms issuing American Depositary Receipts, particularly in the 1990's (Karolyi, 2004).…”

Section: Introductionmentioning

confidence: 99%

International Financial Reporting Standards and Earnings Management in Latin America

Rathke

Santana

Lourenço³

et al. 2016

Rev. adm. contemp.

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ResumoEssa pesquisa analisa o nível de gerenciamento de resultados na América Latina após a adoção das International Financial Reporting Standards (IFRS), em comparação aos países anglo-saxões e europeu-continentais. Ela também analisa o efeito da listagem de ações nos Estados Unidos sobre a comparação do nível de gerenciamento de resultados das empresas latino-americanas com empresas estrangeiras. A literatura sobre gerenciamento de resultados considerando países menos desenvolvidos ainda está em construção, e poucos estudos focam esse tema, especialmente na América Latina, apesar de sua relevância para a economia global. A presente pesquisa preenche essa lacuna por meio do exame do nível de gerenciamento de resultados nos principais países latino-americanos que adotam as IFRS (Brasil e Chile), em comparação com os principais países anglo-saxões com tradição em IFRS (Reino Unido e Austrália), e com as principais economias da Europa Continental (França e Alemanha). Os resultados demonstram que os latino-americanos apresentam um maior nível de gerenciamento de resultados que os anglo-saxões e europeu-continentais, e esse comportamento oportunista se mantém significativo quando apenas global players com listagem de ações nos Estados Unidos são analisados. Logo, mesmo com um conjunto único de padrões contábeis de elevada qualidade (IFRS) e fortes incentivos à divulgação, as características específicas dos países produzem forte influência na forma como as IFRS são implementadas em cada país. Palavras-chave: IFRS; gerenciamento de resultados; América Latina. AbstractThis study analyzes the level of earnings management in Latin America after the adoption of the International Financial Reporting Standards (IFRS) and analyzes the role of cross-listing in the United States. The literature on earnings management in less developed countries is still under construction, and few studies focus on this issue, especially with respect to Latin America, despite its relevant role in the global economy. This paper fills this gap in the literature as it analyzes the level of IFRS earnings management regarding the first and main Latin American countries applying IFRS (Brazil and Chile), when compared to the main Anglo-Saxon countries with IFRS tradition (United Kingdom and Australia), and with the main Continental European economies (France and Germany). The results show that Latin American firms present a higher level of earnings management than Continental European and Anglo-Saxon firms, and this opportunistic behavior remains significant when only global players with cross-listing in the United States are analyzed. Thus, even with a unique set of high quality accounting standards (IFRS) and strong reporting incentives, countries' specific characteristics still play an important role in the way IFRS is implemented in each country.

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Does Foreign Direct Investment Promote Economic Growth? Evidence From East Asia and Latin America

Cited by 392 publications

References 13 publications

Does Foreign Direct Investment Lead to Economic Growth? Evidences from Asian Developing Countries

Does Foreign Direct Investment Lead to Economic Growth? Evidences from Asian Developing Countries

The Nexus of FDI, R&D, and Human Capital on Chinese Sustainable Development: Evidence from a Two-Step Approach

International Financial Reporting Standards and Earnings Management in Latin America

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