Re-examining foreign direct investment, exports, and economic growth in asian economies using a bootstrap ARDL test for cointegration

Goh, Soo Khoon; Sam, Chung Yan; McNown, Robert

doi:10.1016/j.asieco.2017.06.001

Cited by 111 publications

(80 citation statements)

References 19 publications

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“…These results supported the finding that the steady GDP growth rate could help the Bangladesh economy to attract steady FDI inflows in the long run. The results of this study, in terms of causality, were similar to that of Chakraborty and Mukherjee (2012), Kivyiro and Arminen (2014), Ozyigit and Eminer (2011), Goh et al (2017), and Basu et al (2003). In terms of causality, however, these results were in contrast to the results of Katircioglu (2009), Sunde (2017), Azman-Saini et al 2010, Shahbaz and Rahman (2010), Ibrahiem (2015), and Wang (2009).…”

Section: Results Of Granger Causalitysupporting

confidence: 82%

Nexus between foreign direct investment and economic growth in Bangladesh: an augmented autoregressive distributed lag bounds testing approach

Sarker

Khan

2020

Financ Innov

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The relationship between foreign direct investment (FDI) inflows and economic growth in host countries is a heavily debated issue. Although some studies have found evidence of the positive impact of FDI on economic growth, others have revealed the opposite result. Studies that examined the causality between FDI and gross domestic product (GDP) also have found evidence of unidirectional causality and, in some cases, a bidirectional causality. This study investigated the causal nexus between FDI and GDP in Bangladesh by employing standard time-series econometric tools, namely, augmented Dickey-Fuller, augmented Dickey-Fuller generalized least square, Kwiatkowski-Phillips-Schmidt-Shin, and Lee-Strazicich unit root tests to check stationarity, augmented autoregressive distributed lag (augmented ARDL) bounds testing approach to check cointegration, and Granger causality to explore the direction of causality. The augmented ARDL model found a long-run relationship between FDI and GDP. In addition, the error correction model and Granger causality results indicated the presence of a unidirectional causality running from GDP to FDI.

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Section: Results Of Granger Causalitysupporting

confidence: 82%

Nexus between foreign direct investment and economic growth in Bangladesh: an augmented autoregressive distributed lag bounds testing approach

Sarker

Khan

2020

Financ Innov

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“…Similarly, (Flora and Agrawa 2014;Pandya and Sisombat 2017;Mehic et al 2013). Goh et al (2017) submitted that on the overall, there is no evidence of the positive impact of FDI in the long-run for the Asian economies, confirming the work of Mah (2010) and Khobai et al (2017). Bezuidenhout (2009) proved that the perceived impact of FDI on economic growth is a fallacy for the southern Africa region.…”

Section: Literature Reviewmentioning

confidence: 59%

New insight into the causal linkage between economic expansion, FDI, coal consumption, pollutant emissions and urbanization in South Africa

Joshua

Bekun

Sarkodıe

2020

Environ Sci Pollut Res

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This study examines the relationship between foreign direct investment inflows and economic growth by incorporating the role of urbanization, coal consumption and CO2 emissions as additional variables to avoid omitted variable bias. The different order of integration from the unit root test suggested the adoption of a dynamic autoregressive distributed lag bounds testing procedure. The results confirmed the existence of a long-run equilibrium relationship between the outlined series within the period under investigation with a high speed of convergence. The ARDL equilibrium relationship shows that coal consumption is the largest emitter of carbon dioxide emissions in both short-(0.77%) and long-(0.86%) run. Economic growth was found to escalate CO2 emission by approximately 0.27% (in the short-run) and 0.19% (in the long-run).The Granger causality test indicates a non-causal effect between FDI inflow and economic expansion in South Africa, which implies that FDI is not a driver of economic advancement. The empirical study shows a bidirectional causal effect between urbanization and foreign direct investment. This suggests that urban development stimulates foreign direct investment in South Africa. The findings reveal a one-way link from GDP to coal consumption, suggesting economic prosperity promotes coal consumption. The study underscores that economic development and the attraction of more economic investments is in part, dependent on the conservative policy, development of urban centres through infrastructural improvement, and establishing industrial zones.

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“…Other studies remain neutral as to whether or not FDI inflow drives economic growth (Flora and Agrawal 2014;Pandya and Sisombat 2017;Mehic et al 2013). Goh et al (2017) submit that on the overall, there is no evidence of the positive impact of FDI in the long run for the Asian economies, confirming the work of Mah (2010) and Khobai et al (2017). Bezuidenhout (2009) proved that the perceived impact of FDI on economic growth is a fallacy for the southern Africa region.…”

Section: Review Of Literaturementioning

confidence: 71%

Modeling the nexus between coal consumption, FDI inflow and economic expansion: does industrialization matter in South Africa?

Joshua

Bekun

Adedoyin

2020

Environ Sci Pollut Res

101

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This study examines the role of industrialization in the energy-growth-FDI nexus for the case of South Africa using data over the period 1970 to 2018. The empirical exercise was conducted using Pesaran Autoregressive Distributed Lag (ARDL) bounds testing approach. To accomplish our study objective, we analyze stationarity properties of the series using the unit root test after which we applied Bayer-Hanck (B-H) combined technique to cointegration to assess whether a long-run relationship exists among the series. Empirical results show that a 1% change in FDI account for 0.002% and 0.013% increase in economic expansion in the short-and long-run respectively. Also, a 1% increase in coal consumption influence GDP negatively by 0.083% and 0.207% in the short and long run respectively. Furthermore, a 1% increase in total natural resource rent positively affects GDP by 0.02% and 0.05% respectively in the short and long run. Industrialization, on the other hand, demonstrates a positive and significant impact on the economic growth process both in the short and long run. Industrialization contributes 0.506% and 1.274% to economic expansion both in the short and long run respectively. The causality tests suggest that a one-way causal link running from FDI to industrialization and from industrialization to coal consumption exists. Finally, FDI inflow drives total natural resource rents in South Africa. This study also gives reliable growth and energy policy proposals to policymakers applicable to countries around the globe.

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Re-examining foreign direct investment, exports, and economic growth in asian economies using a bootstrap ARDL test for cointegration

Cited by 111 publications

References 19 publications

Nexus between foreign direct investment and economic growth in Bangladesh: an augmented autoregressive distributed lag bounds testing approach

Nexus between foreign direct investment and economic growth in Bangladesh: an augmented autoregressive distributed lag bounds testing approach

New insight into the causal linkage between economic expansion, FDI, coal consumption, pollutant emissions and urbanization in South Africa

Modeling the nexus between coal consumption, FDI inflow and economic expansion: does industrialization matter in South Africa?

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