FDI and Growth: a Causal Relationship

Abdur Chowdhury () and George Mavrotas

No RP2005-25, WIDER Working Paper Series from World Institute for Development Economic Research (UNU-WIDER)

Abstract: The paper examines the causal relationship between FDI and economic growth by using an innovative econometric methodology to study the direction of causality between the two variables. We apply our methodology, based on the Toda-Yamamoto test for causality, to time-series data covering the period 1969-2000 for three developing countries, namely Chile, Malaysia and Thailand, all of them major recipients of FDI with a different history of macroeconomic episodes, policy regimes and growth patterns.

Keywords: Econometric models (Economic development); Foreign investments; Macroeconomics (search for similar items in EconPapers)
Date: 2005
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Citations: View citations in EconPapers (44)

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