GROWTH CONSEQUENCES OF FOREIGN DIRECT INVESTMENT: SOME RESULTS FOR TURKEY

Ali F. Darrat and Jayanta Sarkar
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Ali F. Darrat: Department of Economics and Finance, Louisiana Tech University

Journal of Economic Development, 2009, vol. 34, issue 2, 85-96

Abstract: Turkey has become the dominant recipient of FDI inflows in the Western Asian region. We explore if such inflows have promoted growth as expected. Our analysis of the FDI/growth nexus focuses both on the long-and short-run relations and allows for the possibility that growth also responds to other factors. The results support the theoretical priors and support the existence of a robust long-run relationship linking real economic growth with FDI inflows, economic openness and human capital. Among the three growth ingredients, only human capital accumulation (good education) appears capable of stimulating economic growth in the short-run as well. The results further imply that programs to attract larger FDI inflows to Turkey should persist for some time before they can produce noticeable economic benefits.

Keywords: FDI Inflows; Economic Growth; Human Capital; Turkey (search for similar items in EconPapers)
JEL-codes: F21 F41 O15 (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:jed:journl:v:34:y:2009:i:2:p:85-96

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