Foreign Direct Investments, Technology Transfer and Economic Growth. A Panel Approach
AbstractThis 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 InfoArticle provided by Institute for Economic Forecasting in its journal Romanian Journal for Economic Forecasting.
Volume (Year): (2012)
Issue (Month): 2 (June)
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economic growth; foreign direct investments; absorption capacity; longrun equilibrium; bi-directional causality;
Find related papers by JEL classification:
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
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