Does Foreign Direct Investment Matter Anymore?
John C. Edmunds and
Applied Economics and Finance, 2015, vol. 2, issue 4, 95-102
Although Foreign Direct Investment (FDI) is widely believed to raise the receiving country¡¯s economic growth, the statistical evidence to support that belief is weak. The macro-level data portray a mixed set of results. FDI neither raises nor lowers a country¡¯s economic growth in the time range from the year when the FDI comes in to three years after it arrives. There are many possible explanations why the data show such a weak association between FDI and economic growth. These include reasons why the data do not show the benefit, even though the benefit exists; and reasons why FDI might not raise a country¡¯s economic growth. In the data that we examined, increases in a country¡¯s national stock market capitalization were more positively associated with the country¡¯s subsequent economic growth.
Keywords: foreign direct investment; international finance; economic development (search for similar items in EconPapers)
JEL-codes: F21 F3 (search for similar items in EconPapers)
References: Add references at CitEc
Citations 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:rfa:aefjnl:v:2:y:2015:i:4:p:95-102
Access Statistics for this article
More articles in Applied Economics and Finance from Redfame publishing Contact information at EDIRC.
Series data maintained by Redfame publishing ().