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An Empirical Investigation of Causal Relationship of Chinese FDI to African Economies

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  • Diouf Modou
  • Liu Hai Yun

Abstract

Foreign direct investment (FDI) is frequently viewed as a fundamental component in any nation's given mission for economic development. There is slight uncertainty that the growth of Chinese trade and investment with developing and underdeveloped African states has furnished these countries with a supreme chance to rejuvenate their economies. This study reviewed driving factors of Chinese FDI to African economies utilizing a panel data from 1980- 2016. This study applied Granger causality test, under vector error correction modeling (VECM) to check causality among the factors. Whereas the determinants of FDI inflows were measured utilizing applying ECM and granger causality measurements as proposed by Anyanwu (2012), the dependent variable is FDI inflows to growth, was proxy by the proportion of FDI streams to total national output (GDP). Results showed that factors showing the determinants of FDI inflows have positive influence on development of West African and Monetary Unions economies.

Suggested Citation

  • Diouf Modou & Liu Hai Yun, 2017. "An Empirical Investigation of Causal Relationship of Chinese FDI to African Economies," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 7(3), pages 199-207, March.
    • Handle: RePEc:hur:ijarbs:v:7:y:2017:i:3:p:199-207
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    References listed on IDEAS

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    Cited by:

    1. Keilla Dayane Silva-Oliveira & Edson Keyso Miranda Kubo & Michael J. Morley & Rodrigo Médici Cândido, 2021. "Emerging Economy Inward and Outward Foreign Direct Investment: A Bibliometric and Thematic Content Analysis," Management International Review, Springer, vol. 61(5), pages 643-679, October.

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