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FDI and health in developed economies: A panel cointegration analysis

Author

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  • Herzer, Dierk
  • Nunnenkamp, Peter

Abstract

This paper examines the long-run effect of FDI on health in developed countries. Using panel cointegration techniques, we find a significant and negative long-run effect.

Suggested Citation

  • Herzer, Dierk & Nunnenkamp, Peter, 2012. "FDI and health in developed economies: A panel cointegration analysis," Kiel Working Papers 1756, Kiel Institute for the World Economy (IfW).
  • Handle: RePEc:zbw:ifwkwp:1756
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    References listed on IDEAS

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    1. Angus Deaton, 2003. "Health, Inequality, and Economic Development," Journal of Economic Literature, American Economic Association, vol. 41(1), pages 113-158, March.
    2. M. Hashem Pesaran, 2007. "A simple panel unit root test in the presence of cross-section dependence," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(2), pages 265-312.
    3. Kar, Saibal & Saha, Shrabani, 2012. "Corruption, Shadow Economy and Income Inequality: Evidence from Asia," IZA Discussion Papers 7106, Institute for the Study of Labor (IZA).
    4. Dierk Herzer & Philipp Hühne & Peter Nunnenkamp, 2014. "FDI and Income Inequality—Evidence from Latin American Economies," Review of Development Economics, Wiley Blackwell, vol. 18(4), pages 778-793, November.
    5. Chi, Wei, 2012. "Capital income and income inequality: Evidence from urban China," Journal of Comparative Economics, Elsevier, vol. 40(2), pages 228-239.
    6. Robert J. Waldmann, 1992. "Income Distribution and Infant Mortality," The Quarterly Journal of Economics, Oxford University Press, vol. 107(4), pages 1283-1302.
    7. Peter Pedroni, 2007. "Social capital, barriers to production and capital shares: implications for the importance of parameter heterogeneity from a nonstationary panel approach," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(2), pages 429-451.
    8. Im, Kyung So & Pesaran, M. Hashem & Shin, Yongcheol, 2003. "Testing for unit roots in heterogeneous panels," Journal of Econometrics, Elsevier, vol. 115(1), pages 53-74, July.
    9. Céline Azémar & Rodolphe Desbordes, 2009. "Public Governance, Health and Foreign Direct Investment in Sub-Saharan Africa," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 18(4), pages 667-709, August.
    10. Pedroni, Peter, 1999. " Critical Values for Cointegration Tests in Heterogeneous Panels with Multiple Regressors," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 653-670, Special I.
    11. Alsan, Marcella & Bloom, David E. & Canning, David, 2006. "The effect of population health on foreign direct investment inflows to low- and middle-income countries," World Development, Elsevier, vol. 34(4), pages 613-630, April.
    12. Herzer, Dierk & Nunnenkamp, Peter, 2012. "The effect of foreign aid on income inequality: Evidence from panel cointegration," Structural Change and Economic Dynamics, Elsevier, vol. 23(3), pages 245-255.
    13. Marcella Alsan & David E. Bloom & David Canning, 2004. "The Effect of Population Health on Foreign Direct Investment," NBER Working Papers 10596, National Bureau of Economic Research, Inc.
    14. M. Hashem Pesaran, 2006. "Estimation and Inference in Large Heterogeneous Panels with a Multifactor Error Structure," Econometrica, Econometric Society, vol. 74(4), pages 967-1012, July.
    15. Pandej Chintrakarn & Dierk Herzer & Peter Nunnenkamp, 2012. "Fdi And Income Inequality: Evidence From A Panel Of U.S. States," Economic Inquiry, Western Economic Association International, vol. 50(3), pages 788-801, July.
    16. Johansen, Soren, 2000. "Modelling of cointegration in the vector autoregressive model," Economic Modelling, Elsevier, vol. 17(3), pages 359-373, August.
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    Citations

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    Cited by:

    1. Jacob Kolster, 2015. "North Africa - Working paper - Does foreign direct investment improve welfare in North African countries?," Working Paper Series 2162, African Development Bank.
    2. Antoci, Angelo & Borghesi, Simone & Russu, Paolo & Ticci, Elisa, 2015. "Foreign direct investments, environmental externalities and capital segmentation in a rural economy," Ecological Economics, Elsevier, vol. 116(C), pages 341-353.
    3. Md. Samsul Alam & Syed Ali Raza & Muhammad Shahbaz & Qaisar Abbas, 2016. "Accounting for Contribution of Trade Openness and Foreign Direct Investment in Life Expectancy: The Long-Run and Short-Run Analysis in Pakistan," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 129(3), pages 1155-1170, December.
    4. Sucharita Ghosh & Francesco Renna, 2015. "The Relationship Between Communicable Diseases and FDI Flows: An Empirical Investigation," The World Economy, Wiley Blackwell, vol. 38(10), pages 1574-1593, October.

    More about this item

    Keywords

    FDI; health; panel cointegration;

    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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