Does Chinese Foreign Direct Investment (FDI) Stimulate Economic Growth in Pakistan? An Application of the Autoregressive Distributed Lag (ARDL Bounds) Testing Approach
The objective of this paper is to ascertain the impact of Chinese FDI on economic growth in Pakistan. This study documents the exploration of the determinants of economic growth in Pakistan by emphasizing the significant role played by Chinese FDI and investments in renewable energy in particular. T...
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| Format: | Article |
| Language: | English |
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MDPI AG
2022-03-01
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| Series: | Energies |
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| Online Access: | https://www.mdpi.com/1996-1073/15/6/2050 |
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| author | Muhammad Salman Ahmad Elżbieta Izabela Szczepankiewicz Dai Yonghong Farid Ullah Ihsan Ullah Windham Eugene Loopesco |
| author_facet | Muhammad Salman Ahmad Elżbieta Izabela Szczepankiewicz Dai Yonghong Farid Ullah Ihsan Ullah Windham Eugene Loopesco |
| author_sort | Muhammad Salman Ahmad |
| collection | DOAJ |
| description | The objective of this paper is to ascertain the impact of Chinese FDI on economic growth in Pakistan. This study documents the exploration of the determinants of economic growth in Pakistan by emphasizing the significant role played by Chinese FDI and investments in renewable energy in particular. This paper employs time series data analysis to examine the relationship between GDP and Chinese FDI, inflation, trade openness, exchange rates, interest rates, remittances, and renewable energy consumption from 1990 to 2019. The study involved performing the ARDL bounds test, and it was determined that the dependent and independent variables are linked in the long term. Furthermore, the error correction model is negative and noteworthy, which checks the long-run relationship between variables. According to the findings of the autoregressive distributed lag (ARDL) model, Chinese FDI has a substantial favorable effect on Pakistan’s economic growth. Furthermore, renewable energy usage has a long-term favorable and significant association with Pakistan’s economic growth. This study established that FDI, and particularly renewable energy, will stimulate the economic growth of Pakistan. Our research has substantial policy implications, especially when it comes to the relationship between FDI and renewable energy. |
| first_indexed | 2024-03-09T19:53:05Z |
| format | Article |
| id | doaj.art-63fe6c7b5d604a9d934c73a66672e01c |
| institution | Directory Open Access Journal |
| issn | 1996-1073 |
| language | English |
| last_indexed | 2024-03-09T19:53:05Z |
| publishDate | 2022-03-01 |
| publisher | MDPI AG |
| record_format | Article |
| series | Energies |
| spelling | doaj.art-63fe6c7b5d604a9d934c73a66672e01c2023-11-24T01:03:47ZengMDPI AGEnergies1996-10732022-03-01156205010.3390/en15062050Does Chinese Foreign Direct Investment (FDI) Stimulate Economic Growth in Pakistan? An Application of the Autoregressive Distributed Lag (ARDL Bounds) Testing ApproachMuhammad Salman Ahmad0Elżbieta Izabela Szczepankiewicz1Dai Yonghong2Farid Ullah3Ihsan Ullah4Windham Eugene Loopesco5School of Tourism and Management, Qujing Normal University, Qujing 655011, ChinaInstitute of Accounting and Financial Management, Poznań University of Economics and Business, 61-875 Poznań, PolandInstitute of China’s Overseas Interests, Shenzhen University, Shenzen 518060, ChinaDepartment of Financial Engineering, School of Economics, Sichuan University, No. 24, South Section 1, Yihuan Road, Chengdu 610065, ChinaSchool of International Studies, Collaborative Innovation Center for Security and Development of Western frontier China, Sichuan University, No. 24, South Section 1, Yihuan Road, Chengdu 610065, ChinaDenver Business School, University of Colorado, 1475 Lawrence Street, Denver, CO 80202, USAThe objective of this paper is to ascertain the impact of Chinese FDI on economic growth in Pakistan. This study documents the exploration of the determinants of economic growth in Pakistan by emphasizing the significant role played by Chinese FDI and investments in renewable energy in particular. This paper employs time series data analysis to examine the relationship between GDP and Chinese FDI, inflation, trade openness, exchange rates, interest rates, remittances, and renewable energy consumption from 1990 to 2019. The study involved performing the ARDL bounds test, and it was determined that the dependent and independent variables are linked in the long term. Furthermore, the error correction model is negative and noteworthy, which checks the long-run relationship between variables. According to the findings of the autoregressive distributed lag (ARDL) model, Chinese FDI has a substantial favorable effect on Pakistan’s economic growth. Furthermore, renewable energy usage has a long-term favorable and significant association with Pakistan’s economic growth. This study established that FDI, and particularly renewable energy, will stimulate the economic growth of Pakistan. Our research has substantial policy implications, especially when it comes to the relationship between FDI and renewable energy.https://www.mdpi.com/1996-1073/15/6/2050renewable energyeconomic growthARDLChinese FDI |
| spellingShingle | Muhammad Salman Ahmad Elżbieta Izabela Szczepankiewicz Dai Yonghong Farid Ullah Ihsan Ullah Windham Eugene Loopesco Does Chinese Foreign Direct Investment (FDI) Stimulate Economic Growth in Pakistan? An Application of the Autoregressive Distributed Lag (ARDL Bounds) Testing Approach Energies renewable energy economic growth ARDL Chinese FDI |
| title | Does Chinese Foreign Direct Investment (FDI) Stimulate Economic Growth in Pakistan? An Application of the Autoregressive Distributed Lag (ARDL Bounds) Testing Approach |
| title_full | Does Chinese Foreign Direct Investment (FDI) Stimulate Economic Growth in Pakistan? An Application of the Autoregressive Distributed Lag (ARDL Bounds) Testing Approach |
| title_fullStr | Does Chinese Foreign Direct Investment (FDI) Stimulate Economic Growth in Pakistan? An Application of the Autoregressive Distributed Lag (ARDL Bounds) Testing Approach |
| title_full_unstemmed | Does Chinese Foreign Direct Investment (FDI) Stimulate Economic Growth in Pakistan? An Application of the Autoregressive Distributed Lag (ARDL Bounds) Testing Approach |
| title_short | Does Chinese Foreign Direct Investment (FDI) Stimulate Economic Growth in Pakistan? An Application of the Autoregressive Distributed Lag (ARDL Bounds) Testing Approach |
| title_sort | does chinese foreign direct investment fdi stimulate economic growth in pakistan an application of the autoregressive distributed lag ardl bounds testing approach |
| topic | renewable energy economic growth ARDL Chinese FDI |
| url | https://www.mdpi.com/1996-1073/15/6/2050 |
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