Theoretical and Applied Economics
No. 2 / 2025 (643), Summer
Complementary relationship between foreign direct investment, financial development threshold and economic growth: evidence from Sub-Saharan Africa
University of Sfax, Tunisia
Zouheir ABIDA
University of Sfax, Tunisia
Abstract. The purpose of this paper is to determine the mediating effect of financial development in foreign direct investment (FDI) and the link of growth and to establish the threshold of financial development in 24 sub-Saharan African countries over the period 1995-2022. This paper found that FDI and the development of the financial system have no significant impact on economic growth in sub-Saharan Africa. However, when the interactive term foreign direct investment and financial development was introduced into the model, the effect of foreign direct investment on economic growth became positive and significant, while the coefficient of the interaction term was negative and significant. This implies that the sub-Saharan Africa does not have a sufficient financial system to effectively allocate external resources. As a result, this study used the TR to determine the minimum level of private sector credit as a percentage of GDP, which sets a threshold of 79.32.
Contents
A bibliometric analysis on inequalities in higher education in the age of educational expansion
Trending over thinking – quick fame, quiet genius: the bad habits of social media
Understanding the impact of artificial intelligence on the stock market development in BRICS nations: a panel ARDL method
A comparative analysis of development in SAARC countries in the relation of sustainable development – taxonomic analysis
Complementary relationship between foreign direct investment, financial development threshold and economic growth: evidence from Sub-Saharan Africa
Artificial intelligence as a disruptive force in economics: transformations, challenges, and future prospects
The main drivers of labour cost dynamics in Central and Eastern European countries
Government debt service, interest rates, and macroeconomic stability: a conceptual approach
Shaping health systems through strategy and economics: a global bibliometric exploration of policy pathways
Energy and economics: an empirical study on the global economic impact of energy crisis
Monetary policy, inflation, and exchange rate dynamics: evidence from the Turkish economy (2001-2023)
The impact of public spending on the inflation rate in Algeria: an econometric study for the period 2000-2023
Analyze the environmental sustainability factors in India: the role of ecological footprint and CO2 emission
Implications of monetary and fiscal policy shocks: evidence from an Eastern European economy
From e-government to efficient transport: investigating Romania’s digital leverage in logistics
Impact of ICT adoption on the food security of agricultural households in Burkina Faso
Greek tax policy and macroeconomic framework after the political transition, a systematic approach
Is Balance of Payments a monetary phenomenon: doctrinal aspects and empirical evidence from India
Neuroeconomics in the Age of AI: how machine learning alters human decision-making at the neural level
Analysis of the relationship between the optimal level of public spending and economic growth Evidence and experimental study on Algeria