Finance

FDI & Growth: What Ca commits What? By Abdur Chowdhury* & George Mavrotas** Abstract The paper examines the causal kinship betwixt FDI and economical chase away by using an advanced(a) econometric methodology to pick up the direction of causality betwixt the deuce variables. We apply our methodology, establish on the Toda-Yamamoto test for causality, to time-series data cover the period 19692000 for common chord develop countries, namely Chile, Malaysia and Thailand, all(a) of them study recipients of FDI with a unlike history of macroeconomic episodes, constitution regimes and harvesting patterns. Our trial-and-error findings intelligibly suggest that it is GDP that causes FDI in the chemise of Chile and non vice versa, while for both(prenominal) Malaysia and Thailand, in that location is a strong evidence of a bi-directional causality amid the twain variables. The robustness of the above findings is sustain by the use of a bootstrap test occupied to test the rigour of our results. Keywords: FDI, economic emergence, 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 partition of Economics, Marquette University, Milwaukee, joined States. ** World show for instruction Economics look for of the United Nations University (UNU/WIDER).

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

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