FOREIGN DIRECT INVESTMENT - GROWTH NEXUS: A REVIEW ...

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International Journal of Applied Econometrics and Quantitative Studies Vol. 4-2 (2007)Bosworth andCollins(1999)De Mello(1999)Sjoholmn(1999a)Soto (2000) 44developingcountriesBende-Nabende et al.(2000)UNCTAD(2000)Bengoa(2000)Alfaro et al.(2001)1978-95Sub-SaharanAfrica (4)58developingcountries(18emergingmarkets)32countries(15 OECDand 17non-OECD)1970-90Indonesia 1980-911986-97AsiaPacificRegion (5countries)1970-94100 LDC 1970-9518 Latin 1972-American 1997countriesDifferentsamples39countriesmixed41developedc.49developingThreeperiods1981-971977-971970-9588Positive through impact on TFPNot strong: Positive for OECD,but negative effect for non-OECDPositivePositiveFDI has positive effect for threeout of five countries. FDI hasnegative effect on growth forsingapore and Thailand.PositivePositive and significiantcorrelation between FDI andGrowth if exists a minimumthreshold of developmentassociated with “social capability”Positive
Ozturk, I. Foreign Direct Investment-Growth Nexus: A Review of LiteratureNair-Reichertand Weinhold(2001)Ericsson andIrandoust(2001)Hanson(2001)Lensink andMorrissey(2001)Reisen andSoto (2001)Carkovic andLevine (2002,2005)Chakrabortyand Basu(2002)Campos andKinoshita(2002)Wang (2002)Bazzoni et al.(2002)Liu et al.(2002)Basu et al.(2003)Kumar andPradhan(2002)c.24developingcountriesSweeden,Norway,Denmark,Finland115countries44countries72countries1971-951975-981986-971960-1995India 1974-9625transitionaleconomies12 Asianeconomies11 MEDcountries1990-981987-971970-99China 1981-9723developingcountries107developingcountries1980-9989Significant and positiveCausal relationship only forSweedenPositive but weakPositivePositiveNo effectCausality runs from real GDP toFDI.FDI in India is labor displacingpositivePositivePositivePositivePositive but depends on tradeopennessPanel data estimations in aproduction function frameworksuggest a positive effect of FDI ongrowth. However, tests of causalityfind that in a majority of cases thedirection of causation is notpronounced and in a substantial
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