Open AccessThe Macroeconomic Determinants and FDI: Evidence from 14 International Alliances
Author(s) -
Sujan Chandra Paul,
Harun Or Rosid,
Mohammad Rakibul Islam,
Refat Ferdous
Publication year - 2021
Publication title -
asian development policy review
Language(s) - English
Resource type - Journals
eISSN - 2518-2544
pISSN - 2313-8343
DOI - 10.18488/journal.107.2021.92.69.82
Subject(s) - foreign direct investment , international economics , economics , european union , international trade , positive relationship , gross domestic product , panel data , economic growth , macroeconomics , psychology , social psychology , econometrics
This study investigates the relationship between Foreign Direct Investment (FDI) and some macroeconomic variables such as Gross Domestic Product (GDP), Gross Capital Formation (GCF), Agriculture, Forestry, and Fishing (AFF), Industry, Import, Export, Inflation and Unemployment rate. Panel Data of 14 regional alliances countries from 1990-2018 were collected from The World Bank website. Robust regression models are used in this study. This research found that GDP had significant positive relationship with FDI in all regions except Arab League, EU and G7 countries. GCF had significant positive relationship with FDI in Arab League, BRI, GATT, NAFTA countries & negative relationship in APEC, G7 countries. AFF had significant positive relationship with FDI in BRICS, GATT countries & negative relationship in African Union, ASEAN, BIMSTEC, BRI, BRICS, SAFTA countries. Industry had significant positive relationship with FDI in African Union, BRI, NAFTA, OECD countries and negative relationship in BRICS, G7, G20 countries. Import had significant positive relationship with FDI in African Union, APEC, Arab League, ASIAN, BRI, G7, G20, GATT countries and negative relationship in BRICS countries. Export had significant positive relationship with FDI in BRICS countries and negative relationship in African Union, ASEAN, BRI, G20, GATT, OECD, SAFTA countries. Inflation had significant positive relationship with FDI in GATT, SAFTA countries and negative relationship in African Union, APEC countries. Unemployment rate had significant positive relationship with FDI in African Union, BRI, BRICS, EU, G20, GATT, OECD, SAFTA countries and negative relationship in ASEAN countries.