Frimpong, Joseph Magnus and Oteng-Abayie, Eric Fosu (2006): Bivariate causality analysis between FDI inflows and economic growth in Ghana.
Preview |
PDF
MPRA_paper_351.pdf Download (124kB) | Preview |
Abstract
The main objective for this paper is to study the causal link between FDI and GDP growth for Ghana for the pre- and post-SAP periods. We also study the direction of causality between the two variables, based on the more robust Toda-Yamamoto (1995) Granger no-causality test which allows the Granger test in an integrated system. Annual time-series data covering the period 1970-2002 was used. The study finds no causality between FDI and growth for the total sample period and the pre-SAP period. FDI however caused GDP growth during the post-SAP period.
Item Type: | MPRA Paper |
---|---|
Original Title: | Bivariate causality analysis between FDI inflows and economic growth in Ghana |
Language: | English |
Keywords: | Ghana; FDI; seemingly unrelated regression; Granger causality; cointegration |
Subjects: | O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O49 - Other C - Mathematical and Quantitative Methods > C3 - Multiple or Simultaneous Equation Models ; Multiple Variables > C32 - Time-Series Models ; Dynamic Quantile Regressions ; Dynamic Treatment Effect Models ; Diffusion Processes ; State Space Models F - International Economics > F3 - International Finance > F39 - Other |
Item ID: | 351 |
Depositing User: | Dr Eric F. Oteng-Abayie |
Date Deposited: | 10 Oct 2006 |
Last Modified: | 26 Sep 2019 14:57 |
References: | Asiedu, E. (2002): “On the Determinants of Foreign Direct Investment to Developing Countries: Is Africa Different?” World Development, 30 (1), pp.107-19. Asiedu, E. (2003): “Policy Reform and Foreign Direct Investment to Africa: Absolute Progress but Relative Decline”, Lawrence, KS: Department of Economics, University of Kansas. Mimeo. Chowdhury, A. and Mavrotas, G. (2005): “FDI and Growth: A Causal Relationship”, UNU-WIDER Research Paper No. 2005/25, UNU-WIDER. de Mello, L. (1999): “Foreign Direct Investment Led Growth: Evidence from Time-Series and Panel Data”, Oxford Economic Papers, 51, 133-151. Dolado, J.J and H. Lutkepokl (1996): “Making Wald Tests Work for Cointegrated VAR Systems” Econometric Review, 15, 369-86. Dufour, J. M. and E. Renault (1999): “Short Run and Long Run Causality in Time Series: Theory” Econometrica, 66, 1099-1125. Giles, J.A. and S. Mirza (1999): “Some Pretesting Issues on Testing for Granger non-Causality”, Econometrics Working Paper EWP9914, Department of Economics, University of Victoria. Giles D. E. A., Tedds L. M. and, Werkneh G. (1999): “The Canadian underground and measured economies: Granger causality results” Department of Economics, University of Victoria. Mimeo. Granger C. W. J. (1969): “Investigating Casual Relationship by Econometric Models and Cross Spectral Methods” Econometrica, 37, 424-458. Granger C. W. J. (1988): “Some recent developments in the concept of causality” Journal of Econometrics, 39, 199–211. Gujarati, D. (1995): Basic Econometrics. 3rd Edition, McGraw-Hill, New York. Ibrahim A (2005): “Sectoral Analysis of Foreign Direct Investment in Ghana”, BOG Research Paper, Research Department, Bank of Ghana. Johansen, S. and K. Juselius (1990): “Maximum Likelihood Estimation and Inference on Cointegration with Applications the Demand for Money” Oxford Bulletin of Economics and Statistics, 52(2), 169-210. Kandiero T. and M. Chitiga (2003): “Trade Openness And Foreign Direct Investment in Africa”, Paper prepared for the Economic Society of Southern Africa 2003 Annual Conference, October 2003, Cape Town, South Africa. Karikari, J.A. (1992): “Causality Between Direct Foreign Investment and Economic Output in Ghana” Journal of Economic Development, 17, pp. 1-12. Kholdy, S. (1995):“Causality between foreign investment and spillover efficiency”, Applied Economics, 27, 74-749. Mosconi, R. and Giannini, C. (1992): “No-Causality in Cointegrated Systems: Representation, Estimation and Testing”, Oxford Bulletin of Economics and Statistics, 54, 399-417. Pindyck, R. S. and Rubinfeld, D. L. (1991): Econometric Models and Economic Forecasts, McGraw-Hill, New York. Rambaldi, A.N., and Doran, H.E. (1996): “Testing for Granger non-causality in cointegrated systems made easy”, Working Papers in Econometrics and Applied Statistics 88, Department of Econometrics, The University of New England. Seabra, F and L. Flach (2005): “Foreign Direct investment and Profit Outflows: A Causality Analysis For the Brazilian Economy.” Economics Bulletin, 6(1), pp.1-15 Shan J., Tian G.G., and Sun F. (1997): “The FDI-led growth hypothesis: further econometric evidence from China”, Economic Division Working Papers 97/2, NSDS, Australia. Sims, C. (1972): “Money, Income and Causality” American Economic Review, 62(4), 540-52. Toda, H.Y and Yamamoto, T. (1995): “Statistical Inference in Vector Autoregressions with Possibly integrated Processes” Journal of Econometrics, 66, 225-250. Tsikata, G.K., Y. Asante and E.M. Gyasi (2000):“Determinants of Foreign Direct Investment in Ghana”. Overseas Development Institute. Yamada, T. and Toda, H.Y. (1998):“Inference in possibly Integrated Vector Autoregressive Models: Some Finite Sample Evidence” Journal of Econometrics, 86, 55-95. UNCTAD (2002). World Investment Report 2002. Geneva: UNCTAD. UNCTAD (2005): “Economic Development In Africa: Rethinking The Role Of Foreign Direct Investment”, UNCTAD/GDS/AFRICA/2005/1, United Nations, Geneva. U.S. Library of Congress(1990): Country Studies-Ghana, http://countrystudies/us/ghana |
URI: | https://mpra.ub.uni-muenchen.de/id/eprint/351 |