Foreign Direct Investment, Financial Development and Economic Growth Evidence from Saudi Arabia

Nasir, Najeeb Muhammad; Rehman, Mohammed Ziaur; Ali, Nasir

doi:10.5430/ijfr.v8n4p228

Cited by 2 publications

(1 citation statement)

References 19 publications

(8 reference statements)

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“…Nasir, Rehman, and Ali (2017) through the frame work of granger causality/VAR approach investigate the connection between FDI, FD and economic growth from 1970 to 2015. The results reveal unidirectional granger causality runs from economic growth to FDI and FD.…”

Section: Literature Reviewmentioning

confidence: 99%

Analysis of financial development and foreign direct investment inflows nexus in ECOWAS countries: Least squares dummy variable approach

2020

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In the competitive world nowadays, financial development (FD) is recognized as one of the important drivers of economic growth via absorptive capacity. The link between FD and foreign direct investment (FDI) inflows in economic community of western african states (ECOWAS) economies is largely ignored in empirical studies. Using panel of 15 ECOWAS countries for the period 1999–2017, with bias corrected least squares dummy variable estimator this study explores the impact of FD on FDI inflows. The empirical findings from this study demonstrate that FD is significant predictor of FDI inflows. The results further suggest that human capital development and trade openness are relevant determinant of FDI influx in ECOWAS countries. The result is robust to alternative indicator of FD; broad money. Functional financial system in the host country is crucial and necessary in attracting foreign capital to the countries; hence FD architecture in the recipient economies should be strengthened.

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Section: Literature Reviewmentioning

confidence: 99%

Analysis of financial development and foreign direct investment inflows nexus in ECOWAS countries: Least squares dummy variable approach

2020

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Investigating the Influence of Financial Development Indicators on Economic Growth: Evidence from South Asia

Tahir

Hayat

Ahmad

2018

AFR

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The study empirically investigates the influence of Financial Development on Economic Growth in South Asia by using six indicators of Financial Development i-e: Gross Fixed Capital Formation (GFCP), Broad Money (M2), Domestic Credit to Private Sector (DCPS), Market Capitalization (MC), Trade Openness (TO) and Foreign Direct Investment (FDI). While Economic Growth is measured by Real Gross Domestic Product per Capita (GDP). For this purpose, the study used panel data from “World Development Indicators” for the period of 1980-2015 of six major South Asian countries i.e. Pakistan, India, Bangladesh, Bhutan, Sri Lanka and Nepal. These countries have common feature of being under-developed. The study shows its uniqueness by considering six under-developed South Asian countries and applying three result estimation techniques i-e: Pooled Group Mean (PMG), The Mean Group (MG) and The Dynamic Fixed Effect (DFE). Different results were produced through these three techniques. Final conclusion was drawn on the basis of Hausman test; that is PMG model estimation technique. Unit root test was also applied to check stationarity. The long run results of PMG model show significance of all independent variables, while short run results state insignificance of all independent variables except FDI. The results are consistent with the literature. Along with other recommendations, the study, especially, focuses that the trade barriers should be removed among South Asian countries as trade openness has positive influence on economic growth. It will result in expanding the magnitude of growth.

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Foreign Direct Investment, Financial Development and Economic Growth Evidence from Saudi Arabia

Cited by 2 publications

References 19 publications

Analysis of financial development and foreign direct investment inflows nexus in ECOWAS countries: Least squares dummy variable approach

Analysis of financial development and foreign direct investment inflows nexus in ECOWAS countries: Least squares dummy variable approach

Investigating the Influence of Financial Development Indicators on Economic Growth: Evidence from South Asia

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