Impact of Foreign Direct Investment and Economic Growth in Ghana: A Cointegration Analysis
Samuel Antwi and
Additional contact information
Samuel Antwi: PhD Student, School of Finance and Economics,Jiangsu University, P.R. China,Lecturer, Koforidua Polytechnic, Ghana
Xicang Zhao: Professor, School of Finance and Economics,Jiangsu University, P.R. China
International Journal of Business and Social Research, 2013, vol. 3, issue 1, 64-74
Foreign direct investment (FDI) has been an important source of economic growth for Ghana, bringing in capital investment, technology and management knowledge needed for economic growth. This paper aims to study the relationship between FDI and economic growth in Ghana for the period 1980-2010 using time series data. The data used in this study was mainly secondary data collected from the period, 1980 to 2010 consisting of yearly observations for each variable. The real GDP growth and foreign direct investment net inflows as percent of GDP (FDI ratio) data were taken from the World Banks World Development Indicators 2011 CD Rom. Yearly time series data covering the period 1980-2010 for which data was available was used. The cointegration methodology is applied on yearly data of FDI, GDP and GNI to determine the extent to which these variables are related. The study establishes that a long-run equilibrium and causal relationship exists between the dependent variable; FDI and the two independent variables under consideration namely, GDP and GNI. It was determined that in the short-run, effects of GDP and GNI volatility on FDI are nearly imaginary. These findings hold practical implications for policy makers, government and investors.
Keywords: Economic Growth; FDI inflows; GDP, GNI; Ghana (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
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:lrc:larijb:v:3:y:2012:i:1:p:64-74
Access Statistics for this article
More articles in International Journal of Business and Social Research from LAR Center Press
Bibliographic data for series maintained by Al Hossain ().