Inward foreign direct investment and aggregate imports: time series evidence from Pakistan
AbstractThis study investigates the impact of inward foreign direct investment (FDI) on aggregate imports in Pakistan using the annual time series data for the period 1981 to 2007. The cointegration results suggest that there exists a unique significant positive long-run equilibrium relationship between inward FDI and aggregate imports in Pakistan. The respective parsimonious short-term dynamic error-correction model also confirms a significant positive short run relationship with high speed of adjustment. The causality result shows unidirectional causality running from inward FDI to aggregate imports in the country. The sensitivity analysis confirms that the results are robust.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 31270.
Date of creation: 06 Jan 2010
Date of revision:
Inward FDI; Imports; Cointegration; Causality;
Find related papers by JEL classification:
- F10 - International Economics - - Trade - - - General
- C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models &bull Diffusion Processes
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
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