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Foreign Direct Investments, Technology Transfer and Economic Growth. A Panel Approach

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  • Hudea Caraman, Oana Simona

    ()
    (Academy of Economic Studies, Bucharest)

  • Stancu, Stelian

    ()
    (Academy of Economic Studies, Bucharest)

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    Abstract

    This paper calls into question the existing of a direct and positive impact of foreign direct investments on economic growth. Considering that many controversial results have been caused by the use of cross-country or time-series investigations that do not reveal all facets of this complex issue, we resorted to panel data, thus capturing the continuously evolving country-specific differences. Our study, made on seven East- European countries, during 1993-2009, is based on panel OLS / GMM fixed and random effect estimations, panel cointegration and causality analysis. The results not only reveal a direct and positive influence of foreign direct investments on gross domestic product, both in the short and in the long-run, therefore reducing the technological gap with more developed countries, but they also render a reverse causality running from GDP to FDI.

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    Bibliographic Info

    Article provided by Institute for Economic Forecasting in its journal Romanian Journal for Economic Forecasting.

    Volume (Year): (2012)
    Issue (Month): 2 (June)
    Pages: 85-102

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    Handle: RePEc:rjr:romjef:v::y:2012:i:2:p:85-102

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    Related research

    Keywords: economic growth; foreign direct investments; absorption capacity; longrun equilibrium; bi-directional causality;

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    References

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    Cited by:
    1. KARGI, Bilal, 2014. "Portfolio in Turkish Economy, and A Long Termed Relation Between Foreign Direct Investments and The Growth, and The Structural Breakage Analysis (1980-2012)," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 70-81.
    2. Bojnec, Štefan & Ferto, Imre, 2014. "Outward Foreign Direct Iinvestments and Merchandise Exports: The European OECD Countries," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 87-99, June.
    3. Sebastian Florian Enea & Silvia Palaºcã, 2012. "Globalization Versus Segregation - Business Cycles Synchronization In Europe," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 4, pages 668-692, December.
    4. Alexandra ADAM & Silvia Elena IACOB, 2012. "Consequences and possible solutions of financial crisis," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(12(577)), pages 142-148, December.

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