BibTex RIS Cite

THE EFFECT OF FINANCIAL DEVELOPMENT ON FOREIGN DIRECT INVESTMENT: THE CASE OF TURKEY

Year 2019, , 649 - 659, 01.10.2019
https://doi.org/10.17130/ijmeb.2019355043

Abstract

The aim of this study is to investigate the effect of financial development on foreign direct investment in Turkey period from 1985 to 2016. For this purpose, the effect of private credits, M2 money supply and stock trading volume indicators on foreign direct investments net inflows is analyzed by ARDL bound analysis. The results indicate that there is a cointegration between the variables in the long run and it illustrates that there is a negative effect of the stock trading volume and private credits on foreign direct investments. In the short run error correction model, contrary to the long run, the effect of private credits on the increase of foreign direct investments has been determined. In addition, while the coefficient of M2 money supply variable is positive in both short and long run, the coefficient related to this variable is statistically significant only in the short run error correction model

References

  • Adewale, A. R. (2016). The relationship between capital market development and inflow of foreign direct investment to Africa– a VECM-conditioned impulse. Kasmera, 44(1), 452-470.
  • Agbloyor, E. K., Abor, J., Adjasi, C. K. D., & Yawson, A. (2013). Exploring the causality links between financial market and foreign direct investment in Africa. Research in International Busines and Finance, 28, 118-134.
  • Antras, P, Desai, M. A., & Foley, C. F. (2008). Multinational firms, FDI flows and imperfect capital markets. NBER Working Paper, 12855.
  • Anyanvu, J. C. (2011). Determinants of foreign direct investment inflows to Africa, 1980-2007. African Development Bank Group Working Paper, 136.
  • Barajas, A., Steiner, R., & Salazar, N. (2000). The impact of liberalization and foreign investment in Colombia’s financial sector. Journal of Development Economics, 63, 157-196.
  • Bilir, K., Chor, D., & Manova, K. (2013). Host-country financial development and multinational activity. NBER Working Paper, 20046.
  • Borensztein, E., Gregorio, J. D., & Lee, J. W. (1998). How does foreign direct investment affect economic growth?. Journal of International Economics, 45, 115–135.
  • Çiftçi, F., & Yıldız, R. (2015). Doğrudan yabancı yatırımların ekonomik belirleyicileri: Türkiye ekonomisi üzerine bir zaman serisi analizi. Business and Economics Research Journal, 6(4), 71-95.
  • Desai, M. A., Foley, C. F., & Hines, J. R. (2003). A multinational perspective on capital structure choice and internal capital markets. NBER Working Paper, 9715.
  • Desai, M. A., Foley, C. F., & Hines, J. R. (2004). Capital controls, liberalizations, and foreign direct investment. NBER Working Paper, 10337.
  • Desbordes, R., & Wei, S. J. (2014). The effects of financial development on foreign direct investment. Policy Research Working Paper, 7065.
  • Desbordes, R., & Wei, S. J. (2017). The effects of financial development on foreign direct investment. Journal of Development Economics, 127,153-168.
  • Dickey, D. A., & W. A Fuller (1979). Distribution of the estimators for autoregressive time series with a unit root. JSTOR, 74(366).
  • Donaubauer, J., Neumayer, E., & Nunnenkamp, P. (2016). Financial market development in host and source countries and its effects on bilateral FDI. Kiel Working Papers, 2029.
  • Dutta, N., & Roy, S. (2008). Foreign direct investment, financial development and political risks. MPRA Working Papers, 10186.
  • Felek, Ş., Yayla, N., & Çağlar, A. (2017). Türkiye’de AB doğrudan yatırımları, finansal gelişme ve ekonomik büyüme ilişkisine ARDL yaklaşımı. International Journal of Economic and Administrative Studies, 20, 63-82.
  • Harrison, A. E., Love, I., & McMillan, M. S. (2004). Global capital flows and financing constraints. Journal of Development Economics, 75, 269-301.
  • Kargaonkar, C. (2012). Analysis of the impact of financial development on Foreign Direct Investment: A data mining approach. Journal of Economics and Sustainable Development, 3(6), 70-78.
  • Klein, M., Peek, J., & Rosengren, E. (2000). Troubled banks, impaired Foreign Direct Investment: The role of relative access to credit. NBER Working Paper, 7845.
  • Nasser, O. M., & Gomez, X. G. (2009). Do well-functioning financial systems affect the FDI flows to Latin America. International Research Journal of Finance and Economics, 29, 60-75.
  • Nwosa, P. I., & Emma-Ebere, O. O. (2017). The impact of financial development on Foreign Direct Investment in Nigeria. Journal of Management and Social Sciences, 6(1), 181-197.
  • Otchere, I. K., Soumare, I., & Yurougou, P. (2011). FDI and financial market development in Africa. Erişim Tarihi: 02.01.2017, https://www.uneca.org/sites/default/files/uploadeddocuments/ AEC/2011/soumare_and_otcherel-fdi_and_financial_market_development_in_africa_0.pdf.
  • Paseran, M. H., Shin, Y., & Smith, R. J. (2001). Bounds testing approaches to the analysis of long run relationship. Erişim Tarihi: 28.01.2018, https://www.repository.cam.ac.uk/bitstream/ handle/1810/418/pss1.pdf?sequence=1&isAllowed=y
  • Saumare, I., & Tchana, F. T. (2011). Causality between FDI and financial market development: Evidence from emerging markets. MPRA Paper, 31328.
  • Sbia, R. & Alrousan, S. (2016). Does financial development induce economic growth in UAE? The role of capitalization and Foreign Direct Investment. International Journal of Economics and Financial Issues, 6(2), 703-710.
  • Şahin, S., & Ege, I. (2015). Financial development and FDI in Greece and neighbouring countries: A panel data analysis. International Conference on Applied Economics, 24, 583-588.
  • Tsaurai, K. (2014). Banking sector development and Foreign Direct Investment: A case of Botswana. Risk Governance and Control: Financial Markets and Institutions, 4(3), 44-50.
  • Zadeh, H. A., & Madani, Y. (2013). Financial market development, FDI and economic growth in Iran. Journal of Basic and Applied Scientific Research, 2(1), 228-230.

FİNANSAL GELİŞMENİN DOĞRUDAN YABANCI YATIRIMLAR ÜZERİNDEKİ ETKİSİ: TÜRKİYE ÖRNEĞİ

Year 2019, , 649 - 659, 01.10.2019
https://doi.org/10.17130/ijmeb.2019355043

Abstract

Çalışmanın amacı Türkiye’de 1985-2016 dönemi için finansal gelişmenin doğrudan yabancı yatırımlar üzerindeki etkisini araştırmaktır. Bu amaç doğrultusunda özel krediler, M2 para arzı ve borsa işlem hacmi göstergelerinin dışarıdan net doğrudan yabancı yatırım girişine etkisi ARDL sınır testi ile analiz edilmiştir. Elde edilen sonuçlar uzun dönemde değişkenler arasında bir eş bütünleşmenin varlığını göstermekle birlikte, doğrudan yabancı yatırımlar üzerinde borsa işlem hacmi ve özel kredilerin negatif bir etkiye sahip olduğuna işaret etmektedir. Kısa dönem hata düzeltme modeli sonuçlarına göre ise uzun dönemin aksine özel kredilerin doğrudan yabancı yatırımları artırıcı etkisi tespit edilmiş, borsa işlem hacmine ilişkin katsayının pozitif olmakla beraber istatistiksel olarak anlamsız olduğu görülmüştür. Bunun yanı sıra M2 para arzı değişkeninin katsayısı hem kısa hem de uzun dönemde pozitif iken, söz konusu değişkene ilişkin katsayı yalnızca kısa dönem hata düzeltme modelinde istatistiksel olarak anlamlıdır.

References

  • Adewale, A. R. (2016). The relationship between capital market development and inflow of foreign direct investment to Africa– a VECM-conditioned impulse. Kasmera, 44(1), 452-470.
  • Agbloyor, E. K., Abor, J., Adjasi, C. K. D., & Yawson, A. (2013). Exploring the causality links between financial market and foreign direct investment in Africa. Research in International Busines and Finance, 28, 118-134.
  • Antras, P, Desai, M. A., & Foley, C. F. (2008). Multinational firms, FDI flows and imperfect capital markets. NBER Working Paper, 12855.
  • Anyanvu, J. C. (2011). Determinants of foreign direct investment inflows to Africa, 1980-2007. African Development Bank Group Working Paper, 136.
  • Barajas, A., Steiner, R., & Salazar, N. (2000). The impact of liberalization and foreign investment in Colombia’s financial sector. Journal of Development Economics, 63, 157-196.
  • Bilir, K., Chor, D., & Manova, K. (2013). Host-country financial development and multinational activity. NBER Working Paper, 20046.
  • Borensztein, E., Gregorio, J. D., & Lee, J. W. (1998). How does foreign direct investment affect economic growth?. Journal of International Economics, 45, 115–135.
  • Çiftçi, F., & Yıldız, R. (2015). Doğrudan yabancı yatırımların ekonomik belirleyicileri: Türkiye ekonomisi üzerine bir zaman serisi analizi. Business and Economics Research Journal, 6(4), 71-95.
  • Desai, M. A., Foley, C. F., & Hines, J. R. (2003). A multinational perspective on capital structure choice and internal capital markets. NBER Working Paper, 9715.
  • Desai, M. A., Foley, C. F., & Hines, J. R. (2004). Capital controls, liberalizations, and foreign direct investment. NBER Working Paper, 10337.
  • Desbordes, R., & Wei, S. J. (2014). The effects of financial development on foreign direct investment. Policy Research Working Paper, 7065.
  • Desbordes, R., & Wei, S. J. (2017). The effects of financial development on foreign direct investment. Journal of Development Economics, 127,153-168.
  • Dickey, D. A., & W. A Fuller (1979). Distribution of the estimators for autoregressive time series with a unit root. JSTOR, 74(366).
  • Donaubauer, J., Neumayer, E., & Nunnenkamp, P. (2016). Financial market development in host and source countries and its effects on bilateral FDI. Kiel Working Papers, 2029.
  • Dutta, N., & Roy, S. (2008). Foreign direct investment, financial development and political risks. MPRA Working Papers, 10186.
  • Felek, Ş., Yayla, N., & Çağlar, A. (2017). Türkiye’de AB doğrudan yatırımları, finansal gelişme ve ekonomik büyüme ilişkisine ARDL yaklaşımı. International Journal of Economic and Administrative Studies, 20, 63-82.
  • Harrison, A. E., Love, I., & McMillan, M. S. (2004). Global capital flows and financing constraints. Journal of Development Economics, 75, 269-301.
  • Kargaonkar, C. (2012). Analysis of the impact of financial development on Foreign Direct Investment: A data mining approach. Journal of Economics and Sustainable Development, 3(6), 70-78.
  • Klein, M., Peek, J., & Rosengren, E. (2000). Troubled banks, impaired Foreign Direct Investment: The role of relative access to credit. NBER Working Paper, 7845.
  • Nasser, O. M., & Gomez, X. G. (2009). Do well-functioning financial systems affect the FDI flows to Latin America. International Research Journal of Finance and Economics, 29, 60-75.
  • Nwosa, P. I., & Emma-Ebere, O. O. (2017). The impact of financial development on Foreign Direct Investment in Nigeria. Journal of Management and Social Sciences, 6(1), 181-197.
  • Otchere, I. K., Soumare, I., & Yurougou, P. (2011). FDI and financial market development in Africa. Erişim Tarihi: 02.01.2017, https://www.uneca.org/sites/default/files/uploadeddocuments/ AEC/2011/soumare_and_otcherel-fdi_and_financial_market_development_in_africa_0.pdf.
  • Paseran, M. H., Shin, Y., & Smith, R. J. (2001). Bounds testing approaches to the analysis of long run relationship. Erişim Tarihi: 28.01.2018, https://www.repository.cam.ac.uk/bitstream/ handle/1810/418/pss1.pdf?sequence=1&isAllowed=y
  • Saumare, I., & Tchana, F. T. (2011). Causality between FDI and financial market development: Evidence from emerging markets. MPRA Paper, 31328.
  • Sbia, R. & Alrousan, S. (2016). Does financial development induce economic growth in UAE? The role of capitalization and Foreign Direct Investment. International Journal of Economics and Financial Issues, 6(2), 703-710.
  • Şahin, S., & Ege, I. (2015). Financial development and FDI in Greece and neighbouring countries: A panel data analysis. International Conference on Applied Economics, 24, 583-588.
  • Tsaurai, K. (2014). Banking sector development and Foreign Direct Investment: A case of Botswana. Risk Governance and Control: Financial Markets and Institutions, 4(3), 44-50.
  • Zadeh, H. A., & Madani, Y. (2013). Financial market development, FDI and economic growth in Iran. Journal of Basic and Applied Scientific Research, 2(1), 228-230.
There are 28 citations in total.

Details

Primary Language Turkish
Journal Section Research Article
Authors

Alper Aslan This is me

Buket Altınoz This is me

Murat Esmeray This is me

Publication Date October 1, 2019
Published in Issue Year 2019

Cite

APA Aslan, A., Altınoz, B., & Esmeray, M. (2019). FİNANSAL GELİŞMENİN DOĞRUDAN YABANCI YATIRIMLAR ÜZERİNDEKİ ETKİSİ: TÜRKİYE ÖRNEĞİ. Uluslararası Yönetim İktisat Ve İşletme Dergisi, 15(3), 649-659. https://doi.org/10.17130/ijmeb.2019355043