Nexus Between Foreign Direct Investment and Employment in Manufacturing and Services Sectors in Tunisia: An ARDL Approach

Mouldi Ben Amor ()
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Mouldi Ben Amor: Department of Economics, college of Economics and Administrative Science, Al Imam Mohammad Ibn Saud Islamic University (IMSIU), PO Box 5701, Riyadh, 11432 Saudi Arabia

International Journal of Economic Sciences, 2023, vol. 12, issue 2, 1-20

Abstract: This study investigated both the cointegration and the causal nexus between foreign direct investment (FDI) and employment in the manufacturing and services sectors in Tunisia by employing the augmented autoregressive distributed lag (ARDL) bounds testing approach. Our findings confirm a long-run relationship among the examined variables. Causality results indicated both short-run and long-run bidirectional causality between FDI and employment in the services sectors as well as between employment in the manufacturing and the services sectors. However, there is a unidirectional causality between FDI and employment in manufacturing running from FDI to employment in Manufacturing. These results are of particular interest and offer new perspectives and insight for new policies toward promoting and diversifying foreign investment as a critical contributor to the manufacturing sector's productive capacity and by extension to its employment level.

Keywords: FDI; employment; Manufacturing; Services; ARDL; causality (search for similar items in EconPapers)
JEL-codes: E24 F21 J21 (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:aop:jijoes:v:12:y:2023:i:2:p:1-20

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