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Cointegration and Causality among Foreign Direct Investment in Tourism Sector, GDP, and Exchange Rate Volatility in Turkey

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  • Sekmen, Fuat

Abstract

The Granger-causality (GC) and error correction (ECM) techniques were applied 1980-2005 data for Turkey to examine cointegration and causality among foreign direct investment(FDI) in tourism sector, overall GDP, and exchange rate volatility (EX). According to the ECM technique, the hypothesis that “no cointegration” was rejected for all three variables. The GC results detect causality runs from one-way from GDP to FDI, but the GC results detect bi-directional causality between GDP and EX suggesting that GDP and EX are jointly determined, but one way causality running from FDI to EX.

Suggested Citation

  • Sekmen, Fuat, 2007. "Cointegration and Causality among Foreign Direct Investment in Tourism Sector, GDP, and Exchange Rate Volatility in Turkey," MPRA Paper 8736, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:8736
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    References listed on IDEAS

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    Cited by:

    1. Mounir Belloumi & Atef Alshehry, 2018. "The Impacts of Domestic and Foreign Direct Investments on Economic Growth in Saudi Arabia," Economies, MDPI, vol. 6(1), pages 1-17, March.
    2. Syeda Tamkeen Fatima, 2017. "Absorptive Capacity and FDI Spillovers: Evidence from Quantile Regressions," The International Trade Journal, Taylor & Francis Journals, vol. 31(4), pages 360-385, August.
    3. Victalice Ngimanang Achamoh & Francis Menjo Baye, 2016. "Implications Of Foreign Direct Investment, Financial Development And Real Exchange Rate For Economic Growth In Cameroon," EuroEconomica, Danubius University of Galati, issue 1(35), pages 149-163, may.
    4. Daniel Balsalobre‐Lorente & Oana M. Driha & George Halkos & Shekhar Mishra, 2022. "Influence of growth and urbanization on CO2 emissions: The moderating effect of foreign direct investment on energy use in BRICS," Sustainable Development, John Wiley & Sons, Ltd., vol. 30(1), pages 227-240, February.
    5. Temiz, Dilek & Gökmen, Aytaç, 2014. "FDI inflow as an international business operation by MNCs and economic growth: An empirical study on Turkey," International Business Review, Elsevier, vol. 23(1), pages 145-154.

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    More about this item

    Keywords

    Cointegration; Causality; Vector Error Correction Model; Turkey;
    All these keywords.

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General

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