FDI and Local Financial Market Development:A Granger Causality Test Using Panel Data

Ashraf Mahmoud

MPRA Paper from University Library of Munich, Germany

Abstract: This paper reports the findings of Granger causality tests on the relationship between foreign direct investment (henceforth, FDI) and local financial market development across 62 countries from 1996 to 2007. In this paper we explore whether local financial market development is important in catalyzing the flow of foreign direct investment. findings results are robust to different measures of financial market development. Furthermore, the results indicate that most of the causal links are found in Non OECD, Low income and Lower middle Income countries.

Keywords: FDI; Financial market, Capital markets; Credit markets (search for similar items in EconPapers)
JEL-codes: F21 G10 G15 O16 P45 (search for similar items in EconPapers)
Date: 2010-08-27
New Economics Papers: this item is included in nep-ifn
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:24654

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