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Outward Foreign Direct Investment and Economic Growth: Evidence from Japan

Author

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  • Chew Ging Lee

Abstract

This article aims at analysing the role of foreign direct investment (FDI) outflows in economic performance and the impact of economic growth on outward FDI with the data from Japan. Bivariate and multivariate Granger causality frameworks have been used in this study. The results suggest that the conclusion of bivariate framework may not be valid because it allows omission of important variables. The results of the multivariate framework show that there is a long-run positive unidirectional causality from outward FDI to gross domestic product (GDP) per capita. In the short-run, both per capita income and outward FDI do not allow Granger causality.

Suggested Citation

  • Chew Ging Lee, 2010. "Outward Foreign Direct Investment and Economic Growth: Evidence from Japan," Global Economic Review, Taylor & Francis Journals, vol. 39(3), pages 317-326.
    • Handle: RePEc:taf:glecrv:v:39:y:2010:i:3:p:317-326
    DOI: 10.1080/1226508X.2010.513143
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    Citations

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    Cited by:

    1. Khan, Hameed & Khan, Umair, 2019. "Financial development and FDI inflows in China," Economics Discussion Papers 2019-54, Kiel Institute for the World Economy (IfW Kiel).
    2. Qabhobho, Thobekile & Moyo, Clement & Tsaurai, Kunofiwa, 2023. "Complementarity or Substitutability between Outward FDI and Exporting in Influencing Economic Growth: The BRICS Countries Analysis," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 76(2), pages 275-296.
    3. Rishika Nayyar & Jaydeep Mukherjee, 2018. "Outward FDI from India: A macro level examination in the presence of structural breaks," Working Papers 1833, Indian Institute of Foreign Trade.
    4. N.M. Odhiambo, 2021. "Foreign Direct Investment and Economic Growth in Kenya: An Empirical Investigation," Working Papers AESRI-2021-04, African Economic and Social Research Institute (AESRI), revised Jan 2021.
    5. Nicholas M. Odhiambo, 2022. "Foreign Direct Investment and Economic Growth in Kenya: An Empirical Investigation," International Journal of Public Administration, Taylor & Francis Journals, vol. 45(8), pages 620-631, June.
    6. Faisal Mehmood & Muhammad Atique & Wang Bing & Hameed Khan & Henna Henna, 2021. "Infrastructure and sectoral FDI in China: an empirical analysis," Insights into Regional Development, VsI Entrepreneurship and Sustainability Center, vol. 3(2), pages 160-175, June.
    7. Ciesielska, Dorota & Kołtuniak, Marcin, 2017. "Outward foreign direct investments and home country’s economic growth," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 482(C), pages 127-146.
    8. Akintoye V. Adejumo & Simplice A. Asongu, 2019. "Foreign Direct Investment, Domestic Investment and Green Growth in Nigeria: Any Spillovers?," Working Papers of the African Governance and Development Institute. 19/078, African Governance and Development Institute..
    9. Lee, Chin, 2013. "The Role of Macroeconomic Fundamentals in Malaysian Post Recession Growth," MPRA Paper 44808, University Library of Munich, Germany.
    10. Shahbaz, Muhammad & Nasreen, Samia & Abbas, Faisal & Anis, Omri, 2015. "Does foreign direct investment impede environmental quality in high-, middle-, and low-income countries?," Energy Economics, Elsevier, vol. 51(C), pages 275-287.
    11. Jinji, Naoto & Zhang, Xingyuan & Haruna, Shoji, 2019. "Does a firm with higher Tobin’s q prefer foreign direct investment to foreign outsourcing?," The North American Journal of Economics and Finance, Elsevier, vol. 50(C).
    12. Muhammad Shahbaz & Samia Nasreen & Talat Afza, 2014. "Environmental Consequences of Economic Growth and Foreign Direct Investment: Evidence from Panel Data Analysis," Bulletin of Energy Economics (BEE), The Economics and Social Development Organization (TESDO), vol. 2(2), pages 14-27, June.
    13. Faisal Mehmood & Muhammad Atique & Wang Bing & Hameed Khan & Henna Henna, 2021. "Infrastructure and sectoral FDI in China: an empirical analysis," Post-Print hal-03583884, HAL.
    14. Ojewumi, Sunday Johnson & Akinlo, Anthony Enisan, 2017. "Foreign Direct Investment, Economic Growth and Environmental Quality in SubSaharan Africa: A Dynamic Model Analysis," African Journal of Economic Review, African Journal of Economic Review, vol. 5(1), January.
    15. Rudra P. Pradhan & Mak B. Arvin & John H. Hall & Sahar Bahmani, 2014. "Causal nexus between economic growth, banking sector development, stock market development, and other macroeconomic variables: The case of ASEAN countries," Review of Financial Economics, John Wiley & Sons, vol. 23(4), pages 155-173, November.
    16. Rudra P. Pradhan, Mak B. Arvin, & Mahendhiran Nair, Jay Mittal, & Neville R. Norman, 2017. "Telecommunications infrastructure and usage and the FDI–growth nexus: evidence from Asian-21 countries "Abstract: This paper examines causal relationships between telecommunications infrastructur," Department of Economics - Working Papers Series 2032, The University of Melbourne.
    17. Alnoah Abdulsalam & Helian Xu & Waqar Ameer & AL-Barakani Abdo & Jiejin Xia, 2021. "Exploration of the Impact of China’s Outward Foreign Direct Investment (FDI) on Economic Growth in Asia and North Africa along the Belt and Road (B&R) Initiative," Sustainability, MDPI, vol. 13(4), pages 1-16, February.
    18. Azka Amin & Sofia Anwar & Xi‐Hua Liu, 2022. "Outward foreign direct investment and economic growth in Romania: Evidence from non‐linear ARDL approach," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(1), pages 665-677, January.
    19. Sundus Jasim Shaaibith* & Shatha Salem Daly & Munaf Marza Neama, 2018. "Dynamic Relationship between Foreign Direct Investment & Economic Growth in Iraq: Evidence from ARDL Bound Testing Approach," The Journal of Social Sciences Research, Academic Research Publishing Group, pages 391-395:5.
    20. Rudra P. Pradhan & Mak B. Arvin & John H. Hall, 2019. "The Nexus Between Economic Growth, Stock Market Depth, Trade Openness, And Foreign Direct Investment: The Case Of Asean Countries," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 64(03), pages 461-493, June.

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    Keywords

    Causality; outward FDI; growth;
    All these keywords.

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