Foreign Direct Investment, Growth of Output Indicators and Economic Growth in China: Empirical Evidence on Causal Links
<p>This paper examines the causality between foreign direct investment, growth of output indicators and gross domestic product in China between 1995-2016 using Granger causality test based on the vector error correction model. In contemporary times, attention has been drifted from overall fore...
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| Format: | Article |
| Language: | English |
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EconJournals
2018-05-01
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| Series: | International Journal of Economics and Financial Issues |
| Online Access: | https://www.econjournals.com/index.php/ijefi/article/view/6457 |
| _version_ | 1797923511363174400 |
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| author | Ayamba Emmanuel Caesar Chen HaiBo Thomas Bilaliib Udimal Andrew Osei-Agyemang |
| author_facet | Ayamba Emmanuel Caesar Chen HaiBo Thomas Bilaliib Udimal Andrew Osei-Agyemang |
| author_sort | Ayamba Emmanuel Caesar |
| collection | DOAJ |
| description | <p>This paper examines the causality between foreign direct investment, growth of output indicators and gross domestic product in China between 1995-2016 using Granger causality test based on the vector error correction model. In contemporary times, attention has been drifted from overall foreign direct investment as engine of growth in the analysis of economic growth to sectoral composition of the economy. This paper considers the growth of output indicators (manufacturing, service and agricultural sectors) as engines of growth. The results indicate a bidirectional causal link between gross domestic product and foreign direct investment in the long and short runs. There was however a uni-directional relation between gross domestic product and manufacturing and service sectors in the long run. A short run causal link exists between gross domestic product and manufacturing but not for service. The study does not confirm causality to run from gross domestic product to agriculture.</p><p><strong>Keywords</strong>: FDI; Economic growth; VECM causality</p><p><strong>JEL Classifications: </strong>F21, F43<strong></strong></p> |
| first_indexed | 2024-04-10T14:47:28Z |
| format | Article |
| id | doaj.art-f7536152754c43d2ac03560d69cabd9d |
| institution | Directory Open Access Journal |
| issn | 2146-4138 |
| language | English |
| last_indexed | 2024-04-10T14:47:28Z |
| publishDate | 2018-05-01 |
| publisher | EconJournals |
| record_format | Article |
| series | International Journal of Economics and Financial Issues |
| spelling | doaj.art-f7536152754c43d2ac03560d69cabd9d2023-02-15T16:07:46ZengEconJournalsInternational Journal of Economics and Financial Issues2146-41382018-05-01833153223317Foreign Direct Investment, Growth of Output Indicators and Economic Growth in China: Empirical Evidence on Causal LinksAyamba Emmanuel Caesar0Chen HaiBoThomas Bilaliib UdimalAndrew Osei-AgyemangJiangsu University School of Finance and Economics, Zhenjiang, China<p>This paper examines the causality between foreign direct investment, growth of output indicators and gross domestic product in China between 1995-2016 using Granger causality test based on the vector error correction model. In contemporary times, attention has been drifted from overall foreign direct investment as engine of growth in the analysis of economic growth to sectoral composition of the economy. This paper considers the growth of output indicators (manufacturing, service and agricultural sectors) as engines of growth. The results indicate a bidirectional causal link between gross domestic product and foreign direct investment in the long and short runs. There was however a uni-directional relation between gross domestic product and manufacturing and service sectors in the long run. A short run causal link exists between gross domestic product and manufacturing but not for service. The study does not confirm causality to run from gross domestic product to agriculture.</p><p><strong>Keywords</strong>: FDI; Economic growth; VECM causality</p><p><strong>JEL Classifications: </strong>F21, F43<strong></strong></p>https://www.econjournals.com/index.php/ijefi/article/view/6457 |
| spellingShingle | Ayamba Emmanuel Caesar Chen HaiBo Thomas Bilaliib Udimal Andrew Osei-Agyemang Foreign Direct Investment, Growth of Output Indicators and Economic Growth in China: Empirical Evidence on Causal Links International Journal of Economics and Financial Issues |
| title | Foreign Direct Investment, Growth of Output Indicators and Economic Growth in China: Empirical Evidence on Causal Links |
| title_full | Foreign Direct Investment, Growth of Output Indicators and Economic Growth in China: Empirical Evidence on Causal Links |
| title_fullStr | Foreign Direct Investment, Growth of Output Indicators and Economic Growth in China: Empirical Evidence on Causal Links |
| title_full_unstemmed | Foreign Direct Investment, Growth of Output Indicators and Economic Growth in China: Empirical Evidence on Causal Links |
| title_short | Foreign Direct Investment, Growth of Output Indicators and Economic Growth in China: Empirical Evidence on Causal Links |
| title_sort | foreign direct investment growth of output indicators and economic growth in china empirical evidence on causal links |
| url | https://www.econjournals.com/index.php/ijefi/article/view/6457 |
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