Does the Inflow of FDI Stock Matter? Evidence from SAARC Countries
Hem C. Basnet and
Economic Papers, 2014, vol. 33, issue 3, 305-312
type="main" xml:id="ecpa12078-abs-0001"> This paper examines the influence of foreign direct investment (FDI) on economic growth in five SAARC member countries – Bangladesh, India, Nepal, Pakistan, and Sri Lanka. Using time series data from 1990 to 2010, an empirical model is estimated in which growth of real GDP depends on FDI, investment, openness, tax policy and inflation. After establishing the stationarity of the data series, cointegration tests are performed, and an error correction model is developed and estimated. The empirical results indicate that, unlike investment and openness to international trade, FDI has not played a significant role in promoting economic growth in these countries. We conclude that the effectiveness of FDI may depend in part on the size of the inflows, as well as the level of economic development.
References: Add references at CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bla:econpa:v:33:y:2014:i:3:p:305-312
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0812-0439
Access Statistics for this article
Economic Papers is currently edited by Rachel Ong
More articles in Economic Papers from The Economic Society of Australia Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().