Theoretical and Applied Economics
No. 1 / 2018 (614), Spring
Macroeconomic uncertainty and FDI in developing countries
Department of Economics, Pondicherry University, India
Abstract. In this research analysis, the main aspect is to estimate the macroeconomic uncertainty and its impact on Foreign Direct Investment. Keeping in view of the rising importance of developing countries in attracting Foreign Direct Investment (FDI), this study has included 28 developing countries for the empirical analysis. At first, Macroeconomic uncertainty is measured with the help of conditional variance technique i.e. ARCH (GARCH). After measuring the macroeconomic uncertainty, impact of macroeconomic uncertainty along with other macroeconomic variables on the FDI flow is analyzed. Relying on the non-dynamic panel threshold model, the presence of single threshold value is found. The impact of macroeconomic uncertainty on FDI is found to be varied with the change in the level of income of the concerned host country. Others factors like GDP growth, Trade Openness and FDI stock are found to be statistically significant in influencing FDI flow towards an economy.
Contents
Political economy map – A useful tool for public policy decision makers
Macroeconomic uncertainty and FDI in developing countries
Impact of foreign direct investment inflows on tax revenues in OECD countries: A panel cointegration and causality analysis
Macroprudential stability indicators of financial systems: Analysis of Bosnia and Herzegovina and Croatia
Does exchange rate always affect the number of inbound tourists significantly in China?
The effects of Turkish-Russian political relations on bilateral trade balance: Cointegration and causal analysis
The relationship between financial deepening and economic growth: Bootstrap causality approach for the selected upper middle income countries
Financial development, trade openness and growth in India
The impact of carbon dioxide (CO2) emissions on tourism: Does the source of emission matter?
Effect of exchange rate policy on GDP and GDP components: The Kyrgyz Republic Case
Dynamic linkages between corruption, economic growth, and income inequality in Pakistan: Say ‘No’ to corruption
Impact of defence expenditures on external debt: An econometric analysis for Turkey and Turkic Republics