Aggregate and heterogeneous sectoral growth effects of foreign direct investment in Egypt

Ingham, Hilary; Read, Robert; Elkomy, Shimaa

doi:10.1111/rode.12698

Cited by 16 publications

(16 citation statements)

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“…According to Endo (2006), tourism in developing countries (e.g., Egypt) faces some challenges such as lacking capital, access to international marketing networks, etc., thus, it is crucial for such nations to seek FDI to overcome these drawbacks. In this vein, Egypt has substantially adjusted its growth strategy and plans to concentrate on attracting inflows of FDI in order to enhance its technological infrastructure and base, and strengthen its domestic productivity (Ingham, Read, & Elkomy, 2020).…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Examining foreign direct investment determinants of tourism industry in Oman and Egypt: The moderating role of investment environment

Alkathiri¹,

Soliman

2020

Int. J Fin Econ

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Limited research has examined foreign direct investment (FDI) determinants within the tourism industry, particularly in the MENA region. Thus, based on the internationalization framework of Dunning (Multinational enterprises and the global economy, Addison‐Wesley, 1993), this article aims to empirically investigate and compare the FDI determinants of the tourism industry in Oman and Egypt not only through the investors perceptive but more importantly through other stakeholders perspective such as experts in economy and tourism sector due to their vital role in decision making. It also examines the moderating role of investment environment on the relationship between the determinants and attractiveness of FDI. Further, PLS‐SEM was employed for data analysis purposes. The results revealed that resource‐seeking and efficiency‐seeking have a significant role in both countries. However, though market‐seeking was positive and significant in Egypt, it was found insignificant in Oman. Interestingly, the investment environment has a significant moderating role in both countries. The current study contributes to the literature by providing an obvious understanding of tourism FDI determinants with a special emphasis on the essential view of the related experts. It also presents a clear sight to tourism authorities on the essential factors that attract FDI in tourism.

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Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Examining foreign direct investment determinants of tourism industry in Oman and Egypt: The moderating role of investment environment

Alkathiri¹,

Soliman

2020

Int. J Fin Econ

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“…Second, previous studies that examine sectoral‐level FDI focuses on the variations among primary, secondary and tertiary sectors (Kannen, 2020) or focus their examination between the manufacturing and services sector (Hanafy & Marktanner, 2019). We follow the approach of Ingham, Read, and Elkomy (2020) and Fillat and Woerz (2011), and examine the role of absorptive capacities at the industrial‐level (based on OECD data availability), providing new empirical evidence on which absorptive capacities matter for varying industries.…”

Section: Introductionmentioning

confidence: 99%

Re‐examining the impact of sectoral‐ and industrial‐level FDI on growth: Does institutional quality, education levels and trade openness matter?

Haini

Tan

2022

Australian Economic Papers

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This study examines whether institutional quality, education levels and trade openness affect the relationship between sectoral‐ and industrial‐level foreign direct investment (FDI) inflows and economic growth. Previous studies highlight the heterogeneous effects of FDI at the sectoral‐ and industrial‐level suggesting the need to examine the growth effects of FDI at a disaggregated level. However, previous studies have not empirically explored the role of absorptive capacities at the industrial‐ and sectoral‐level. Consequently, using a sample of 36 Organisation for Economic Co‐operation and Development countries from 2000 to 2019, we examine the relationship using the system generalised method of moments estimator to control for endogeneity. Our results show that the magnitudinal effects of overall FDI is dampened as sectoral‐ and industrial‐effects are not considered. We find that both manufacturing and services FDI contributes to growth. However, the effect of manufacturing FDI is greater. Meanwhile, we find education levels to be an effective moderator for services FDI, while trade openness enhances the growth effects of manufacturing FDI more effectively. Institutional quality is shown to have a positive complementary effect across both sectors and certain industries. Policy implications are discussed.

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“…Similarly, Hanafty and Marktanner (2018)'s Generalized method of moments (GMM) panel estimation in Egypt from 1992 to 2007 indicates that agriculture FDI has a negative relationship with economic growth, manufacturing FDI is positive but modest, and service FDI has no influence on economic growth. In terms of manufacturing, the findings of Ingham et al (2020) in Egypt are similar to Hanafty and Marktanner's (2018) findings; however, in terms of services, the author generates different conclusions that have a negative influence on economic growth. Jana et al (2019) used data from 1995 to 2019 to look at the effect of FDI sectoral composition on India's economic growth.…”

Section: Negative Relationshipmentioning

confidence: 53%

The Contribution of FDI to Economic Growth in Developing Countries

Emako¹

2022

JUSST

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The paper considers analyzing the effect of sector-specific foreign direct investment (the primary, secondary, and tertiary sectors) on economic growth in 19 developing countries for the period 2005-2018 following human capital, domestic investment, financial development, the openness of the economy, labor force, institutional quality, and natural resource richness as control variables through Arellano and Bond (1991) differenced GMM. It reveals that FDI in manufacturing has a positive and statistically significant influence on economic growth, whereas FDI in the tertiary sector has a statistically significant negative effect on economic growth, but FDI in the primary sector has a negative but negligible effect on economic growth. Lastly, it can be concluded from the above results that the more manufacturing FDI that countries attract, the greater their economic growth will be. Therefore, these countries should pay attention to it.

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Aggregate and heterogeneous sectoral growth effects of foreign direct investment in Egypt

Abstract: This is an open access article under the terms of the Creative Commons Attribution-NonCommercial-NoDerivs License, which permits use and distribution in any medium, provided the original work is properly cited, the use is non-commercial and no modifications or adaptations are made.

Cited by 16 publications

References 44 publications

Examining foreign direct investment determinants of tourism industry in Oman and Egypt: The moderating role of investment environment

Examining foreign direct investment determinants of tourism industry in Oman and Egypt: The moderating role of investment environment

Re‐examining the impact of sectoral‐ and industrial‐level FDI on growth: Does institutional quality, education levels and trade openness matter?

The Contribution of FDI to Economic Growth in Developing Countries

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