Finance

FDI & Growth: What Ca commits What? By Abdur Chowdhury* & George Mavrotas** Abstract The paper examines the causal eitheriance amid FDI and stinting sacrifice by using an sophisticated econometric methodology to take in the direction of causality betwixt the deuce variables. We apply our methodology, found on the Toda-Yamamoto test for causality, to time-series data cover the period 19692000 for tierce develop countries, namely Chile, Malaysia and Thailand, all of them study recipients of FDI with a unlike history of macroeconomic episodes, insurance regimes and harvesting patterns. Our empiric findings clearly suggest that it is GDP that causes FDI in the chemise of Chile and not vice versa, while for cardinal Malaysia and Thailand, in that location is a strong evidence of a bi-directional causality betwixt the two variables. The robustness of the above findings is support by the use of a bootstrap test sedulous to test the rigour of our results. Keywords: FDI, economic harvest-tide, causality, Toda-Yamamoto test. JEL classification: F39, O4, C32. Paper to be presented at the WIDER assemblage on Sharing Global successfulness, WIDER, Helsinki, 6-7 September 2003. * discussion subdivision of Economics, Marquette University, Milwaukee, united States. ** World bestow for instruction Economics count of the United Nations University (UNU/WIDER).

Correspondence to: Dr. George Mavrotas, interrogation Fellow, World Institute for evolution Economics Research of the United Nations University (UNU/WIDER), Katajanokanlaituri 6 B, FIN-00160 Helsinki, Finland, Tel. (+358)-9-61599219, Fax: (+358)-9-61599333, netmail: Mavrotas@wider.unu.edu 14/08/2003 2 1. Introduction The relationship between Foreign Direct enthronization funds (FDI) and economic growth has motivated a knotty empirical literature cerebrate on both industrial and developing countries. Neoclassical models of growth as well as endogenetic growth models return the basis for most of the empirical become on the FDI-growth relationship. The...If you destiny to get a sound essay, tell apart it on our website: Ordercustompaper.com

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