Foreign direct investment inflows and economic growth of China

Mah, Jai S.

doi:10.1016/j.jpolmod.2009.09.001

Cited by 68 publications

(48 citation statements)

References 6 publications

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“…They reached the conclusion that FDI does not have any impact on economic growth. Similar to this study, Mah (2010) also tried to analyze this relationship in China by using Granger causality analysis. It is identified that there is not a relationship between foreign direct investment and economic growth.…”

Section: Literature Reviewmentioning

confidence: 94%

Causality Relationship Between Foreign Direct Investments and Economic Improvement for Developing Economies

Adalı¹,

Yüksel²

2017

mjecon

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The aim of this study is to determine whether there is a causality relationship between foreign direct investments and economic growth for developing countries. Within this context, 30 developing countries, which have the highest GDP growth rate in 2016, are taken into the consideration. Furthermore, annual data of these countries for the periods between 1991 and 2015 is evaluated with the help of Dumitrescu Hurlin panel causality analysis. It is concluded that there is a causality relationship from foreign direct investments to economic growth. In other words, it is identified that foreign direct investment is an important cause of economic growth. Hence, it can be said that developing countries should focus on the ways to attract foreign direct investments to their companies in order to have economic growth. In addition to this situation, it is also identified that there is a causality relationship from economic growth to FDI. This situation shows that when the economies of the countries are improved, it attracts foreign investors to make a direct investment in those countries. Keywords

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Section: Literature Reviewmentioning

confidence: 94%

Causality Relationship Between Foreign Direct Investments and Economic Improvement for Developing Economies

Adalı¹,

Yüksel²

2017

mjecon

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“…More precisely, from the dominant liberal view, researchers lay claim to that globalization causes trade and investment opportunities for employment, technology innovation, international economic integration, leading to higher economic growth (Frankel & Romer, 1999;Greenaway et al, 2002;Dreher, 2006;Kim, 2008;Rao & Vadlamannati, 2011). However, evidences of higher levels of globalization have adverse effects on the domestic economy that are also discovered raised by globalization usually increases economic and social inequalities (Vamvakidis, 2002;Jin, 2006); meanwhile, several works find no effect of globalization on economic growth (Dutt, 1997;Tsai & Huang, 2007;Mah, 2010). Unlike any other familiar setting, globalization is treated as economic liberalization and economic internationalism, respectively.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Liang (2007) uses 29 provincial level data to analyse the impact of trade openness on poverty and income growth in urban China and conclude that trade openness has a positive effect on income growth; see also similar finding in Tuan and Ng (2007) as well as Tuan et al (2009) for the case of globalized delta economies as Pearl River Delta and Yangtze River Delta. However, Mah (2010) proposes that FDI inflows have not caused economic growth in China during the period of 1983-2001 after the economic reforms.…”

Section: Literature Reviewmentioning

confidence: 99%

Globalization, Economic Growth and Institutional Development in China

Lee

Chang

李起銓³

2015

Global Economic Review

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Unlike most previous works which commonly define globalization as a strict economic characteristic, using the overall globalization index and its three sub-dimensionseconomic, social and political integrations to proxy openness, this paper examines the effect of globalization on economic growth associated with autocratic institutional in China, using the a two-step dynamic panel generalized method of moments technique in a panel of 30 provinces, municipalities and the autonomous regions over the period of 1970-2006. We find that different globalization indices have different impacts on regional economic growth. Also, autocracy may harm regional development, but these conclusions are very sensitive to different globalization variables specifications. Further, considering the interactive effects between globalization and economic growth, we show that in the period of higher global integration, the higher democracy (lower autocracy) may harm economic growth in the case of China. We emphasize that democracy is clearly not a necessary condition for the purpose of economic growth in China.

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“…Other studies point to the reverse causality of economic growth attracting FDI into the PRC. For example, Mah (2010) finds that FDI did not cause growth over 1983-2001, but that the PRC's growth attracted FDI to the country. Similarly, Zhao and Du (2007) find that FDI was attracted to the PRC as a result of high growth, instead of the other way round.…”

Section: Literature Reviewmentioning

confidence: 99%

How Important are Exports and Foreign Direct Investment for Economic Growth in the People's Republic of China?

Xing

Pradhananga

2013

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Asian Development Bank InstituteThe Working Paper series is a continuation of the formerly named Discussion Paper series; the numbering of the papers continued without interruption or change. ADBI's working papers reflect initial ideas on a topic and are posted online for discussion. ADBI encourages readers to post their comments on the main page for each working paper (given in the citation below). Some working papers may develop into other forms of publication. The views expressed in this paper are the views of the author and do not necessarily reflect the views or policies of ADBI, the ADB, its Board of Directors, or the governments they represent. ADBI does not guarantee the accuracy of the data included in this paper and accepts no responsibility for any consequences of their use. Terminology used may not necessarily be consistent with ADB official terms.Asian Development Bank Institute Kasumigaseki Building 8F 3-2-5 Kasumigaseki, Chiyoda-ku Tokyo 100-6008, JapanTel:+81-3-3593-5500 Fax:+81-3-3593-5571 URL:www.adbi.org E-mail: info@adbi.org AbstractThe global financial crisis and the recent growth slowdown in the People's Republic of China (PRC) have led to questions about the sustainability of PRC growth. The argument is that the PRC is too dependent on external demand and that it needs to rebalance its economy toward domestic consumption. However, conventional measures of external demand-share of net exports and exports as a share of gross domestic product (GDP)-are biased and do not accurately measure the contribution of external demand to GDP growth. In this paper, we propose two measures that are simple modifications of the conventional measures. We argue that our proposed measures provide a more accurate estimate of the vulnerability of the PRC economy to external shocks, in the form of sudden drops in exports and foreign direct investment (FDI). Our estimates show that in 2001 exports and FDI accounted for 18.2% of GDP growth and by 2004 the share had risen to 49%. During 2005-07, the contribution of exports and FDI to growth remained 38%-40%. Our estimates also show that the impressive recovery of the PRC economy in the post-crisis period owed at least 53% of its growth to exports and FDI. Based on these results, we conclude that the PRC economy remains highly dependent on external demand in the form of exports and FDI, and rebalancing the economy toward domestic demand has not yet been achieved.

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Foreign direct investment inflows and economic growth of China

Cited by 68 publications

References 6 publications

Causality Relationship Between Foreign Direct Investments and Economic Improvement for Developing Economies

Causality Relationship Between Foreign Direct Investments and Economic Improvement for Developing Economies

Globalization, Economic Growth and Institutional Development in China

How Important are Exports and Foreign Direct Investment for Economic Growth in the People's Republic of China?

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