Open AccessA Causal Relationship Between Trade, Foreign Direct Investment and Economic Growth in Niger
Author(s) -
Issoufou Oumarou,
Ousseini Amadou Maiga
Publication year - 2019
Publication title -
journal of social and economic statistics
Language(s) - English
Resource type - Journals
ISSN - 2285-388X
DOI - 10.2478/jses-2019-0003
Subject(s) - foreign direct investment , ceteris paribus , economics , granger causality , unit root , unit root test , augmented dickey–fuller test , international economics , investment (military) , causality (physics) , monetary economics , international trade , macroeconomics , econometrics , cointegration , microeconomics , physics , quantum mechanics , politics , political science , law
Foreign direct investment and Trade were regarded as an important elements in enhancing economic development. This study used some time series econometric tests including the Augmented Dickey – Fuller (ADF) unit root test developed by Dickey – Fuller, stationary test developed by Kwiatkowski-Philips-Schmidt-Shin (KPSS), Johansen co-integration test and Granger causality test to analyse the connection between foreign direct investment, trade and economic growth in Niger. The tests results showed a bilateral relationship between trade and economic growth and a unidirectional causal relationship between trade and foreign direct investment with direction from trade to foreign direct investment. The long run effect tests revealed that trade has a positive effect on economic growth while foreign direct investment has a negative effect on economic growth in Niger. On average, ceteris paribus, the coefficients are statistically significant at 5% level.