Foreign Direct Investment, Capital Formation, and Growth

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Abstract

This chapter examines the long-term effect of FDI on growth and capital accumulation in a panel of 65 countries covering a time-period of 1981–2005. It uses the dynamic panel data technique that considers the short-term relationships and the stable adjustment paths leading to the long-term relationships. It aggregates the individual country estimates through the alternative procedures such as mean group, pooled mean group, and dynamic fixed effect. It observes positive long-term effects of FDI on capital accumulation. There is some doubt regarding the impact of FDI on growth.

Keywords

Foreign direct investment Financial globalization Liberalization 

JEL Codes

F21 F43 O10 O16 O50 
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Copyright information

© Springer India 2016

Authors and Affiliations

  1. 1.Department of EconomicsJadavpur UniversityKolkataIndia

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