Foreign Trade and FDI as Main Factors of Growth in the EU

Lucian Albu ()

Journal for Economic Forecasting, 2013, issue 2, 7-17

Abstract: In the last decade, a number of empirical studies tried to highlight a strong correlation among foreign trade, foreign direct investment and economic growth. Moreover, the recent crisis affecting firstly the GDP growth had also a negative impact on foreign trade and on FDI inflow. Today, there is a strong competition both on the goods market and on the capital market. As a rule, in countries where the stock of FDI is high, the foreign trade is in expansion and has a high level of efficiency and, consequently, a relatively stable economic growth is demonstrated. Based on available statistical data, we estimated a model to simulate the impact of FDI on GDP growth in the EU. Further, a similar approach permitted us to investigate the FDIExport- GDP relationship in the case of Romania for the last decade. As a conclusion, to recover economic growth a growth in FDI is needed, taking into account its major impact on the efficiency of foreign trade and its contribution to the general economic growth.

Keywords: FDI; export; economic growth; spatial distribution; convergence (search for similar items in EconPapers)
JEL-codes: C21 E27 F47 O11 O47 O52 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Persistent link: https://EconPapers.repec.org/RePEc:rjr:romjef:v::y:2013:i:2:p:7-17

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