Determinants of Foreign Direct Investment in Romania: a Quantitative Approach

Calcedonia Enache () and Fernando Merino
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Calcedonia Enache: University of Agronomic Sciences and Veterinary Medicine, Bucharest, Romania

The AMFITEATRU ECONOMIC journal, 2017, vol. 19, issue 44, 275

Abstract: This study aims to examine the dynamic relationship between foreign direct investments (FDI) and economic growth, using the Structural Vector Autoregressive model, in the period 2007-2014. The results of the econometric model show that the trajectory of FDI has its own origins, with reduced influences from economic growth. Another important conclusion is that there is a unidirectional causal relationship from the economic growth towards FDI, more precisely the influence of FDI on economic growth does not have a systematic, anticipatory nature. These results were achieved in the condition that, in the analyzed period, the net inflows of FDI were influenced by the lack of certainty on the sustainable re-launching of the economic growth both domestically and internationally, the segmentation of the financial market, the domestic structural reforms.

Keywords: foreign direct investment; economic growth; vector autoregressive model; Sims-Bernanke decomposition; Granger causality test (search for similar items in EconPapers)
JEL-codes: C18 E43 F21 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:aes:amfeco:v:s10:y:2017:i:18:p:275

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