On the causal links between FDI and growth in developing countries
Publikation: Bidrag til tidsskrift › Tidsskriftartikel › Forskning › fagfællebedømt
Standard
On the causal links between FDI and growth in developing countries. / Hansen, Henrik; Rand, John.
I: World Economy, Bind 29, Nr. 1, 2006, s. 21-41.Publikation: Bidrag til tidsskrift › Tidsskriftartikel › Forskning › fagfællebedømt
Harvard
APA
Vancouver
Author
Bibtex
}
RIS
TY - JOUR
T1 - On the causal links between FDI and growth in developing countries
AU - Hansen, Henrik
AU - Rand, John
N1 - JEL Classification: F21, O19
PY - 2006
Y1 - 2006
N2 - We analyse the Granger causal relationships between foreign direct investment (FDI) and GDP in a sample of 31 developing countries covering 31 years. Using estimators for heterogeneous panel data we find bi-directional causality between the FDI-to-GDP ratio and the level of GDP. FDI has a lasting impact on GDP, while GDP has no long-run impact on the FDI-to-GDP ratio. In that sense FDI causes growth. Furthermore, in a model for GDP and FDI as a fraction of gross capital formation (GCF) we also find long-run effects from FDI to GDP. This finding may be interpreted as evidence in favour of the hypotheses that FDI has an impact on GDP via knowledge transfers and adoption of new technology
AB - We analyse the Granger causal relationships between foreign direct investment (FDI) and GDP in a sample of 31 developing countries covering 31 years. Using estimators for heterogeneous panel data we find bi-directional causality between the FDI-to-GDP ratio and the level of GDP. FDI has a lasting impact on GDP, while GDP has no long-run impact on the FDI-to-GDP ratio. In that sense FDI causes growth. Furthermore, in a model for GDP and FDI as a fraction of gross capital formation (GCF) we also find long-run effects from FDI to GDP. This finding may be interpreted as evidence in favour of the hypotheses that FDI has an impact on GDP via knowledge transfers and adoption of new technology
U2 - 10.1111/j.1467-9701.2006.00756.x
DO - 10.1111/j.1467-9701.2006.00756.x
M3 - Journal article
VL - 29
SP - 21
EP - 41
JO - World Economy
JF - World Economy
SN - 0378-5920
IS - 1
ER -
ID: 313925