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Do External and Internal Crises Affect Foreign Portfolio Inflows? The Case of China and India

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  • Fayyaz Ahmad
  • Muhammad Umar Draz
  • Su-Chang Yang

Abstract

This study examines the relationship between external and internal crisis (EIC) and Foreign Portfolio Investment (FPI) net inflows in China and India. We have applied Binary Choice Model taking the EIC as a dummy variable. GDP growth is an independent variable in our model that indicates the combined performance of economic sectors. The results suggest that EIC exert a significant impact on the FPI net inflows, but the nature of internal issues is different for both countries. We find a little association between GDP growth and net FPI inflows.

Suggested Citation

  • Fayyaz Ahmad & Muhammad Umar Draz & Su-Chang Yang, 2016. "Do External and Internal Crises Affect Foreign Portfolio Inflows? The Case of China and India," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 8(7), pages 149-149, July.
    • Handle: RePEc:ibn:ijefaa:v:8:y:2016:i:7:p:149
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    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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