Analysis of FDI and Financial improvements for the Economic growth
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Published:
2017-03-31
Keywords:
FDI, financial development, economic growth ARDL technique
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Abstract
This study is conducted in order to check the long run as well as short run impact of FDI and Financial Development on the economic growth. The study is conducted in the scenario of Pakistan and the time series data is taken for the year 1972-2013. ARDL methodology is used to determine whether FDI has long-term impact on Economic growth or not. Moreover, Granger Causality is used to check a uni-directional relationship and the results support that FDI has an impact over economic growth. Further, it is depicted from ARDL that there is a positive relationship between FDI and Economic Growth.
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Research Article
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How to Cite
Analysis of FDI and Financial improvements for the Economic growth. (2017). Journal of Management Info, 4(1), 29-32. https://doi.org/10.31580/jmi.v13i1.68
References
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Bailliu, J. N. (2000). Private capital flows, financial development, and economic growth in developing countries. Bank of Canada.
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Creane, S., Goyal Rishi, A. Mushfiq Mobarak, and Randa Sab (2004) Financial Sector Development in the Middle East and North Africa. International Monetary Fund, Washington, D.C. (IMF Working Paper 04/201.)
De Mello Jr, L. R. (1997). Foreign direct investment in developing countries and growth: A selective survey. The Journal of Development Studies, 34(1), 1-34.
Durham, J. B. (2004). Absorptive capacity and the effects of foreign direct investment and equity foreign portfolio investment on economic growth.European economic review, 48(2), 285-306.
Goldsmith, R. W. (1969) Financial Structure and Development. New Haven, C.T.: Yale University Press.
Greenwood, j. and r. Jovanovic (1990), “Financial development, growth and the distribution of income†Journal of Political Economy, 98(5), October.
Hermes, N., & Lensink, R. (2003). Foreign direct investment, financial development and economic growth. The Journal of Development Studies, 40(1), 142-163.
King, R. G., & Levine, R. (1993). Finance, entrepreneurship and growth. Journal of monetary Economics, 32(3), 513-542.
King, R. G., and R. Levine (1993a) Finance, Entrepreneurship and Growth. Journal of Monetary Economics 32, 30–71.
Malik, M. F., Anuar, M. A., Khan, S., & Khan, F. (2014). Mergers and Acquisitions: A Conceptual Review. International Journal of Accounting and Financial Reporting, 4(2).
Malik, M. F., Khan, S., Khan, M. I., & Khan, F. (2014). Interest Rate and Its Effect on Bank’s Profitability. J. Appl. Environ. Biol. Sci, 4(8S), 225-229.
Mckinnon, R. I. (1973) Money and Capital in Economic Development. Washington, D. C.: Brooking Institution.
Omran, M., & Bolbol, A. (2003). Foreign direct investment, financial development, and economic growth: evidence from the Arab countries. Review of Middle East Economics and Finance, 1(3), 231-249.
Patrick, H. T. (1966). Financial development and economic growth in underdeveloped countries. Economic development and Cultural change, 174-189.
Pesaran, M.H., Pesaran, B., 1997. Working With Microfit 4.0: Interactive Econo- metric Analysis. Oxford University Press, Oxford.
Pesaran, M.H., Shin, Y., 1999. An autoregressive distributed lag modelling approach to cointegration analysis. In: Strom, S. (Ed.), Econometrics and Economic Theory in 20th Century: The Ragnar Frisch Centennial Symposium. Cambridge University Press, Cambridge Chapter 11.
Pesaran, M.H., Shin, Y., Smith, R.J., 2001. Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics 16, 289–326.
Pesaran, M.H., Smith, R.P., 1998. Structural analysis of cointegrating VARs. Journal of Economic Survey 12, 471–505.
Saibu, M. O., Nwosa, I. P., & Agbeluyi, A. M. (2011). Financial development, foreign direct investment and economic growth in Nigeria. Journal of Emerging Trends in Economics and Management Sciences, 2(2), 146-154.
Bailliu, J. N. (2000). Private capital flows, financial development, and economic growth in developing countries. Bank of Canada.
Carkovic M, Levine R (2002). Does Foreign Direct Investment Accelerate Economic Growth? in H. T. Moran, E. Graham and M.Blomstrom (eds.), Does FDI Promote Development? Washington, DC: Institute for International Economics.
Creane, S., Goyal Rishi, A. Mushfiq Mobarak, and Randa Sab (2004) Financial Sector Development in the Middle East and North Africa. International Monetary Fund, Washington, D.C. (IMF Working Paper 04/201.)
De Mello Jr, L. R. (1997). Foreign direct investment in developing countries and growth: A selective survey. The Journal of Development Studies, 34(1), 1-34.
Durham, J. B. (2004). Absorptive capacity and the effects of foreign direct investment and equity foreign portfolio investment on economic growth.European economic review, 48(2), 285-306.
Goldsmith, R. W. (1969) Financial Structure and Development. New Haven, C.T.: Yale University Press.
Greenwood, j. and r. Jovanovic (1990), “Financial development, growth and the distribution of income†Journal of Political Economy, 98(5), October.
Hermes, N., & Lensink, R. (2003). Foreign direct investment, financial development and economic growth. The Journal of Development Studies, 40(1), 142-163.
King, R. G., & Levine, R. (1993). Finance, entrepreneurship and growth. Journal of monetary Economics, 32(3), 513-542.
King, R. G., and R. Levine (1993a) Finance, Entrepreneurship and Growth. Journal of Monetary Economics 32, 30–71.
Malik, M. F., Anuar, M. A., Khan, S., & Khan, F. (2014). Mergers and Acquisitions: A Conceptual Review. International Journal of Accounting and Financial Reporting, 4(2).
Malik, M. F., Khan, S., Khan, M. I., & Khan, F. (2014). Interest Rate and Its Effect on Bank’s Profitability. J. Appl. Environ. Biol. Sci, 4(8S), 225-229.
Mckinnon, R. I. (1973) Money and Capital in Economic Development. Washington, D. C.: Brooking Institution.
Omran, M., & Bolbol, A. (2003). Foreign direct investment, financial development, and economic growth: evidence from the Arab countries. Review of Middle East Economics and Finance, 1(3), 231-249.
Patrick, H. T. (1966). Financial development and economic growth in underdeveloped countries. Economic development and Cultural change, 174-189.
Pesaran, M.H., Pesaran, B., 1997. Working With Microfit 4.0: Interactive Econo- metric Analysis. Oxford University Press, Oxford.
Pesaran, M.H., Shin, Y., 1999. An autoregressive distributed lag modelling approach to cointegration analysis. In: Strom, S. (Ed.), Econometrics and Economic Theory in 20th Century: The Ragnar Frisch Centennial Symposium. Cambridge University Press, Cambridge Chapter 11.
Pesaran, M.H., Shin, Y., Smith, R.J., 2001. Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics 16, 289–326.
Pesaran, M.H., Smith, R.P., 1998. Structural analysis of cointegrating VARs. Journal of Economic Survey 12, 471–505.
Saibu, M. O., Nwosa, I. P., & Agbeluyi, A. M. (2011). Financial development, foreign direct investment and economic growth in Nigeria. Journal of Emerging Trends in Economics and Management Sciences, 2(2), 146-154.