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How population ageing affects FDI flows: a tale of South Korea

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  • Rajarshi Mitra
  • Md. Thasinul Abedin
  • Kanon Kumar Sen

Abstract

The neoclassical theory predicts that population ageing would reduce net FDI inflows, which would nullify government efforts to attract FDI. There is a complete paucity of literature on the dynamic relation between population ageing and FDI flows for South Korea. This is a distinctive attempt to test the hypothesis that population ageing reduces net FDI flows (% of GDP) in South Korea. The results of the ARDL bounds testing approach to cointegration analysis under structural breaks provide clear evidence of non-linearity between population ageing and net FDI flows (% of GDP). Support for the neoclassical hypothesis is established only in the short-run.

Suggested Citation

  • Rajarshi Mitra & Md. Thasinul Abedin & Kanon Kumar Sen, 2025. "How population ageing affects FDI flows: a tale of South Korea," New Zealand Economic Papers, Taylor & Francis Journals, vol. 59(2), pages 102-123, May.
  • Handle: RePEc:taf:nzecpp:v:59:y:2025:i:2:p:102-123
    DOI: 10.1080/00779954.2024.2415138
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