Bivariate causality analysis between FDI inflows and economic growth in Ghana

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Bivariate causality analysis between FDI inflows and economic growth in Ghana

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Frimpong, Joseph Magnus
Oteng-Abayie, Eric Fosu

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Abstract

The main objective for this paper is to study the causal link between FDI and GDP growth for Ghana for the pre- and post-SAP periods. We also study the direction of causality between the two variables, based on the more robust Toda-Yamamoto (1995) Granger no-causality test which allows the Granger test in an integrated system. Annual time-series data covering the period 1970-2002 was used. The study finds no causality between FDI and growth for the total sample period and the pre-SAP period. FDI however caused GDP growth during the post-SAP period.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 351.

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Date of creation: 26 Aug 2006
Date of revision: 09 Oct 2006
Handle: RePEc:pra:mprapa:351

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Find related papers by JEL classification:
O49 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Other
C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions
F39 - International Economics - - International Finance - - - Other

This paper has been announced in the following NEP Reports:

NEP-AFR-2006-10-21 (Africa)
NEP-ALL-2006-10-21 (All new papers)
NEP-FDG-2006-10-21 (Financial Development & Growth)

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

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Other versions:
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Other versions:
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Sims, Christopher A, 1972. "Money, Income, and Causality," American Economic Review, American Economic Association, vol. 62(4), pages 540-52, September. [Downloadable!] (restricted)
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Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
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Jean-Marie Dufour & Eric Renault, 1998. "Short Run and Long Run Causality in Time Series: Theory," Econometrica, Econometric Society, vol. 66(5), pages 1099-1126, September.
Other versions:
- Dufour, J.M. & Renault, E., 1995. "Short-Run and Long-Rub Causality in Time Series: Theory," Cahiers de recherche 9538, Centre interuniversitaire de recherche en économie quantitative, CIREQ.
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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

Farrokh Nourzad, 2008. "Openness and the Efficiency of FDI: A Panel Stochastic Production Frontier Study," International Advances in Economic Research, Springer, vol. 14(1), pages 25-35, February. [Downloadable!] (restricted)
Frimpong, Joseph Magnus & Oteng-Abayie, Eric Fosu, 2006. "Bounds testing approach: an examination of foreign direct investment, trade, and growth relationships," MPRA Paper 352, University Library of Munich, Germany, revised 09 Oct 2006. [Downloadable!]

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