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Exploring Links between FDI Inflows, Energy Consumption, and Economic Growth: Further Evidence from MENA Countries

Mohamed Abdouli and Sami Hammami
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Mohamed Abdouli and Sami Hammami: University of Sfax, Faculty of Economics and Management of Sfax

Journal of Economic Development, 2017, vol. 42, issue 1, 95-117

Abstract: This study aims to examine the nexus between economic growth, FDI inflows and energy consumption on a panel of 17 countries using a ¡®growth model¡¯ framework and simultaneous-equation models estimated by the generalized method of moments (GMM) over the 1990-2012 period. We also implement these empirical models for 17 countries selected on the basis of data availability. They include: (a) 12 Middle Eastern countries, namely: Saudi Arabia, Qatar, Oman, Kuwait, Lebanon, United Arab Emirates, Iraq, Turkey, Iran, Syria, Jordan and Yemen, (b) 5 North African countries, namely: Egypt, Morocco, Tunisia, Algeria and Libya. Our results indicate that there is a bidirectional causal relationship between FDI inflows and economic growth, as between well as energy consumption and economic growth. Besides, there is a unidirectional causal relationship between energy consumption to FDI inflows for the global panel. This implies that the increase of energy consumption increases the FDI inflows for individual and collective countries.

Keywords: Energy Consumption; FDI Inflows; Economic Growth, MENA Countries, Simultaneous Equation Models (search for similar items in EconPapers)
JEL-codes: O11 B22 B27 B41 C33 (search for similar items in EconPapers)
Date: 2017
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Handle: RePEc:jed:journl:v:42:y:2017:i:1:p:95-117