FOREIGN DIRECT INVESTMENTS – AN ESSENTIAL FACTOR FOR ECONOMIC GROWTH IN TRANSITION ECONOMIES

Carmen Boghean
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Carmen Boghean: Ştefan cel Mare University, Faculty of Economics and Public Administration

SEA - Practical Application of Science, 2015, issue 8, 141-147

Abstract: The purpose of this analysis is to analyse the connection between foreign direct investments and economic growth in transition economies during a period of increased integration of financial systems in the global financial system. The research focuses on the relationship between foreign direct investments and economic growth during 1970-2013, by means of methods such as the graphic, the regression and the correlation ones. The research findings show that there is a direct and strong connection between the inward financial flows of foreign direct investments and the GDP during the period under analysis in transition economies. In transition economies, a high inward flow of foreign direct investments leads to an increase of the Gross Domestic Product per capita, while a positive development of the standard of living will attract new inward FDI flows, since transition economies are seen as attractive recipients/hosts for foreign direct investments.

Keywords: Foreign direct investments; Economic growth; Financial system; Transition economies (search for similar items in EconPapers)
JEL-codes: F01 F21 F43 (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:cmj:seapas:y:2015:i:8:p:141-147

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