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FDI And Economic Growth. Evidence From Simultaneous Equation Models

Author

Listed:
  • Ruxanda, Gheorghe

    () (The Academy of Economic Studies, Bucharest)

  • Muraru, Andreea

    () (The Academy of Economic Studies, Bucharest)

Abstract

This paper analyses whether foreign direct investments have an impact on the Romanian economic growth. By means of simultaneous equation methods we obtained evidence of the bi-directional connection between the two, meaning that incoming FDI stimulates economic growth and, in its turn, a higher GDP attracts FDI. Two methods were used in performing the analysis, one considering the relation between the share of FDI in GDP and economic growth in a five-equation system and the second considering the levels of FDI and GDP, respectively, in a two-equation system.

Suggested Citation

  • Ruxanda, Gheorghe & Muraru, Andreea, 2010. "FDI And Economic Growth. Evidence From Simultaneous Equation Models," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(1), pages 45-58, March.
  • Handle: RePEc:rjr:romjef:v::y:2010:i:1:p:45-58
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    Cited by:

    1. repec:bla:worlde:v:40:y:2017:i:11:p:2512-2527 is not listed on IDEAS
    2. Rendón Obando, Hernando & Ramírez Franco, Luz Dary, 2017. "Impacto de la inversión extranjera directa y del grado de apertura de la economía sobre el crecimiento económico para América Latina 1980-2010/Impact of Foreign Direct Investment and Openness Degree o," Estudios de Economía Aplicada, Estudios de Economía Aplicada, vol. 35, pages 217-244, Enero.
    3. Calcedonia Enache & Fernando Merino, 2017. "Determinants of Foreign Direct Investment in Romania: a Quantitative Approach," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 19(44), pages 275-275, February.
    4. Liliana SCUTARU, 2014. "Foreign Direct Investment In Romania – Structural And Sectorial Dynamics," SEA - Practical Application of Science, Fundația Română pentru Inteligența Afacerii, Editorial Department, issue 5, pages 563-568, November.

    More about this item

    Keywords

    foreign direct investment; economic growth; simultaneous equation models;

    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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