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How Does Foreign Aid Affect the Relationship between IFRS Adoption and Foreign Direct Investment?

Uchenna Efobi () and Nnadi Matthias
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Nnadi Matthias: Cranfield University, UK

No 15/014, Working Papers of the African Governance and Development Institute. from African Governance and Development Institute.

Abstract: This paper constructs a theoretical model to explain the relationship between IFRS adoption, FDI and foreign aid. Using the SGMM estimation technique to check the issue of endogene-ity and reverse causality, this relationship was examined on 92 countries for the period 2003-2012. Overall, IFRS adoption attracts more aid when conditioned on foreign aid; however, when disaggregating foreign aid, the effect of foreign aid on the nexus was contradictory, while multilateral aid flow was positive. This result remained consistent despite the battery of checks.

Keywords: Accounting Standards; Foreign Aid; Foreign Direct Investment; Globalisation; IFRS Adoption (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc and nep-int
Date: 2015-05
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http://www.afridev.org/RePEc/agd/agd-wpaper/Foreig ... adi_TIJA_revised.pdf Revised version, 2015 (application/pdf)

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