• SUVANNABHUMI
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• v.15 no.2
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• pp.215-244
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• 2023

This study analyzes the effect of macroeconomic indicators such as foreign direct investment (FDI), domestic investment, trade, inflation, unemployment, population, and governance indicators on economic growth and points out the GDP growth rate in 2002- 2019 among ASEAN countries. Data were compiled from the Worldwide Governance Indicators (WGI) and the World Bank, and the effect of variables on GDP was predicted using the pooled ordinary least squares (POLS), fixed effects model (FEM), and random effects model (REM) methods. As a measure of growth, the GDP growth rate has been taken; FDI and domestic investment, trade, inflation, and governance indicators are positively connected and have an influence on economic growth in these ASEAN countries; domestic investment, population, and unemployment have a negative relationship to economic growth. The macroeconomic indicators and institutional stability of the nation have an effect on its economic growth. Comprehensive institutional stability and well-laid macroeconomic policies are required for growth to materialize.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.4
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• pp.121-131
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• 2020

This study aims to investigate the interplay between education and local roads on Foreign Direct Investment (FDI) in the Philippines, using economic growth as an instrument. The study used the quantitative research design applying both descriptive and inferential statistics. A combination of Two Stage Least Square Regression Model and three approaches in Panel Regression Model such as Pooled Least Square, Fixed Effect Model, and Random Effect Model were utilized in order to study the effects of education and local roads on foreign direct investment of the Philippines. Based on Fixed Effect regression results, higher education graduates and local road investments, as conditioned by economic growth, were significant factors in order to increase the foreign direct investment in the Philippines. Accordingly, a unit increase in higher education graduates, as conditioned by economic growth, leads to 8.758 unit increases in the foreign direct investment. While, a unit increased in local road investments, as conditioned by economic growth, leads to a 0.002 decrease in foreign direct investment. The regression results of the study suggest that the Foreign Direct Investment in the regions such as CAR, I, II, IV-B, V, VIII, IX, X, XI, XII, XIII, and ARMM are higher compared to Region IV-A.

• Asia-Pacific Journal of Business
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• v.10 no.4
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• pp.153-165
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• 2019

This paper examined economic liberalization and corruption in ASEAN member affect Korea's foreign direct investment. We use 160 (country-year) observations from ASEAN 10 member countries for a period of 16 years from 2001 to 2016, with the Economic Liberalization Index provided by the Fraser Institute and the corruption recognition index provided by the International Transparency Organization. As results, economic liberalization showed a non-linear(U shaped) effect on foreign direct investment and corruption has a negative effect on foreign direct investment.

• Asia-Pacific Journal of Business
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• v.13 no.1
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• pp.37-52
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• 2022

Purpose - The objective of this study is to investigate what motivates global FDI inflows in the different economic development level and to clarify the FDI motivation type in the level of qualitative economic growth. Design/methodology/approach - Major macroscopic social·economic factors induced FDI inflows were analyzed using fixed-effect panel regression with 30-year panel data of 28 countries from 1985 to 2014. For analysis in the stage of economic growth, two category of developed and developing countries was used. And to analyze FDI motivation type in the level of qualitative economic growth, 4 shares of GDP; consumption·government·investment expenditure and export, was used as explanatory variable. Findings - In developed country, TFP(total factor productivity) and GDP have a great influence on FDI inflows, and consumption and labor compensation have a slight effect. This result indicates that the market seeking-driven, horizontal type investment is shown along with efficiency seeking investment. In developing country, human capital and TFP is shown to have greater impact on FDI inflows and labor compensation, exports, investment and government expenditures also have impacts. Thus it has confirmed that not only efficiency-seeking vertical investment for using low cost well educated laborer, but also government-driven economic growth and export policies could affect the FDI inflows. Research implications or Originality - The FDI investment decision making of multinational companies is decided by their own purpose. But, in the concept of as follows; 1) FDI is a long-term capital flowing for maximization of economic utility with limited global resource, 2) Thus FDI could be affected by macro socio·economic factors of host country. 3) Also such macro factors is different by each economic growth qualitative level. Therefore macro socio·economic factors of each country could be affected by the qualitative level of their own economic growth. To attract FDI inflows, it is desirable to implement differentiated incentive policies in the qualitative level of economic growth. Furthermore in developing countries it is recommended to implement government driven economic growth policies as follows; fostering well educated human resources, improving technology productivity in the relative lower cost labor market compared to developed countries and boosting international export volume.

• The Journal of Asian Finance, Economics and Business
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• v.3 no.4
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• pp.57-66
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• 2016

Foreign Direct Investment (FDI) plays a vital role in economic growth of the countries. The present study analyses the impact of the FDI on economic growth of South Asian Association of Regional Cooperation countries by using the pooled data for the period 1990-2014. Neo-classical production function has been used for analysis and getting stock-to-flow estimation, Taylor series approximation has applied. Fixed Effects Model has been used to investigate the impact of FDI, domestic capital, labour and government expenditures on economic growth. It is the evident from the results that both domestic investment and FDI have been a positive effect on economic growth. The study finds that the contribution of domestic private investment is more trustworthy than the contribution of FDI. Consequently, FDI loses its attraction as an engine of growth if the adverse balance of payment consequence of the resulting profit repatriating is also taken into account. The labour has positive and significant association with GDP. The effect of government expenditure is negligible on economic growth. The findings suggest that growth strategy cannot yield the long term benefits if it neglects investments on human capital.

• The Journal of Industrial Distribution & Business
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• v.12 no.9
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• pp.31-42
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• 2021

Purpose: After the reform and opening up, China's overall economic development has entered a new era. From mutual investment and trade transactions between domestic provinces and regions to investment and trade with foreign companies, the continuous supplement of investment funds makes the follow-up development of all aspects of economic development smoother and has played a strong impetus. effect. Foreign direct investment has many influences on the economic development of a country or region. Research design, data and methodology: This article uses the sample data of Shandong Province from 2011 to 2019 to analyze the foreign direct investment in Shandong Province by industry, region, method and other aspects, and study the relationship and influence between foreign direct investment and economic growth. Results: The results show that there is a relatively close relationship between foreign direct investment and economic growth, and it has played a role in promoting economic development in many aspects such as industrial structure, foreign trade, and employment. Conclusions: At the same time, corresponding suggestions are put forward based on the analysis and conclusions drawn.

• The Journal of Asian Finance, Economics and Business
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• v.7 no.2
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• pp.157-168
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• 2020

Since the economic crisis sweeps across the world in 2008, the foreign direct investment of various countries has been greatly impacted. Therefore, this paper regards China as an example to analyze China's outward foreign direct investment patterns in terms of Asian financial markets with a panel data over the period 2003-2017. We mainly focus on the money market oriented outward foreign direct investment and foreign exchange market oriented outward foreign direct investment. Using the individual fixed effect model to conduct empirical analyses, the empirical findings indicate that China will reduce its foreign direct investment amount to a country with large money supply and China will increase its foreign direct investment amount to a country with large foreign exchange reserves. Furthermore, when a country has signed Free Trade Agreement with China, China will increase more foreign direct investment amount to these countries than that of a country who has not signed Free Trade Agreement with China. Moreover, the empirical findings indicate that no matter what the money market oriented outward foreign direct investment or foreign market oriented outward foreign direct investment, China will reduce its foreign direct investment amount to these Asian countries due to the global economic crisis.

• Asia-Pacific Journal of Business
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• v.13 no.4
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• pp.25-43
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• 2022

Purpose - This study is to investigate the direct and moderating effect of intangible variable like economic freedom to facilitating factors on FDI(foreign direct investment) inflows and the difference of facilitating factors by the stage of economic development. Design/methodology/approach - Fixed-effect panel regression analysis with 19-year macro economic data from 2000 to 2019 including economic freedom index from Fraser Institute in 13 developed and 15 developing countries was used. Research implications or Originality - In analysis of direct effect of 5 sectors in economic freedom, the influence of economic freedom was shown weaker than other macro economic factors on FDI inflows, which indicates that actual development of economic factors are more important. The effect of economic freedom on FDI inflows at the stage of economic development differed. In developed countries, human capital, GDP, export, free trade and regulation affected FDI inflows in decreasing order, as did human capital, GDP, consumption expenditure, export, investment expenditure, government expenditure, free trade and sound money in developing countries. In analysis of moderating effect of economic freedom, a domestic and international market size, a flexible labor market which can provide a cheaper good human resources and government expenditures for improving social infrastructure under free economic environment facilitated FDI inflows. However, the statistical significance of moderating effect on export was not shown, which indicates that economic freedom policy itself without actual improvement of exports could not attract FDI inflows.

• Information Systems Review
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• v.19 no.1
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• pp.185-202
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• 2017

Most studies based on production function theory have concluded that economic growth is a result of information technology (IT) capital use. However, some studies have indicated that economic growth is a determinant of IT investment. To determine if these results also hold at the industry level, we use the Granger causality test to analyze bidirectional causality with industry-level data for 1977~2007 from the United States. The results generally reveal that IT investment causes economic growth in many industries under the concept of Granger causality, that economic growth causes IT investment in some industries, and that IT investment is not associated with economic growth in some industries. In the country-level time-series data made by summing up the IT capital and gross output for each industry, the results do not show any causality between IT investment and economic growth. However, they show bi-directional causality between IT investment and economic growth in the panel data. These results may be a source of IT productivity paradox.

• The Journal of Asian Finance, Economics and Business
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• v.2 no.2
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• pp.5-12
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• 2015

The authors calculate the long-term predictability of GDP, domestic demand, investment, and net exports for Guangdong province, P.R. China from 2000 to 2013. A vector autoregressive (VAR) model with quarterly data for this period is first co-integrated then the Granger causality test is applied to empirically assess the relationships among gross domestic product (GDP), consumption, investment, and net exports. There is a strong causality effect between investment and net exports in Guangdong province. However, the variance decomposition results indicate that exports respond to foreign shocks rather than domestic ones, making their impact on the Guangdong economy to predict. Results show the stimulating effect of domestic demand on GDP is larger than the stimulating effect of net exports and much larger than even the stimulating effect of investment. The analysis suggests that there are dynamic influences with various levels of persistence between GDP, consumption, investment, and net exports. Macroeconomic policy adjustments are urgently required to expand domestic demand and thereby stimulate economic growth in Guangdong province.