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In this paper, we analyze causal relationship between foreign direct investment (FDI) and economic growth of Gansu province in China using time-series data from 1986-2010. The analysis is conducted by the means of time-series estimations through ADF unit root test, co-integration tests, error-correction analysis and Granger causality test. The purpose of the paper is to empirically investigate the impact of economic growth on FDI of Gansu in China. The results suggest that FDI does not appear to Granger-cause economic growth, and economic growth also does not significantly affect FDI, which means some studies have overestimated the positive effect of FDI on economic growth, and underestimated the influence of economic growth on FD

Empirical Analysis of FDI and Economic Growth in Gansu China: Based on Time-series Data from 1986 to 2010