A causal relationship between foreign direct investment, economic growth and high technology exports

Abstract

The aim of this study is to examine relationship between foreign direct investment, economic growth and high technology exports for Turkey, Thailand, Singapore, Republic of Korea, India and Brazil during the period 1982-2013. Emirmahmutoğlu and Köse (2011) causality test is employed to examine the relationship. The results indicated that in the panel there is uni-directional causality running from economic growth to foreign direct investment. Besides, there is found uni-directional causality between economic growth to high technology exports. There is detected bi-directional causality between foreign direct investment and high technology exports. According to individual country results it is obtained mixed evidence. In these countries foreign direct investment promotes high technology exports. At the same time high technology exports leads to foreign direct investment inflows.

Keywords

• Foreign direct investment,economic growth,high technology exports,panel causality

Doğrudan yabancı yatırımlar, ekonomik büyüme ve yüksek teknoloji ihracatı arasında bir nedensellik ilişkisi

Öz

Bu çalışmada, Türkiye, Tayland, Singapur, Güney Kore, Hindistan ve Brezilya için 1989-2013 dönemi doğrudan yabancı yatırımlar, ekonomik büyüme ve yüksek teknoloji ihracatı arasındaki ilişki incelenmiştir. Çalışmada Emirmahmutoğlu ve Köse (2011) nedensellik testi kullanılmıştır. Sonuçlar panelde ekonomik büyümeden doğrudan yabancı yatırımlara doğru tek yönlü nedensellik olduğunu göstermiştir. Ayrıca ekonomik büyümeden yüksek teknoloji ihracatına doğru tek yönlü nedensellik ilişkisi olduğu tespit edilmiştir. Doğrudan yabancı yatırımlar ve yüksek teknoloji ihracatı arasında çift yönlü nedensellik ilişkisi saptanmıştır. Bireysel ülke sonuçlarına göre ise karma bulgular elde edilmiştir. Bu ülkelerde doğrudan yabancı yatırımlar yüksek teknolojiye dayalı ihracatı teşvik etmektedir. Aynı zamanda yüksek teknoloji ihracatı bu ülkelerde doğrudan yabancı yatırım girişine neden olmaktadır.

Anahtar Kelimeler

• Ekonomik Büyüme, Doğrudan Sermaye Yatırımları, İleri Teknoloji İhracatı, Panel Nedensellik

References

1. Abbes, S.M., Mostefa, B., Seghir, G.M., & Zakarya, G.Y. (2015). Causal Interaction between FDI, and economic growth: Evidence from dynamic panel co-integration. Procedia Economics and Finance, 23, 276-290.
2. Alguacil, M., Cuadros, A., & Orts, V. (2011). Inward FDI and growth: The role of macroeconomic and institutional environment. Journal of Policy Modelling, 33, 481-496.
3. Basu, P., Chakraborty, C., & Reagle, D. (2003). Liberalization, FDI, and growth in developing countries: A panel cointegration approach. Economic Inquıry, 41(3), 510-516.
4. Borensztein, E., Gregorio, J.D., & Lee, J.W. (1998). How does foreign direct investment affect economic growth?. Journal of International Economics, 45, 115-135.
5. Busse, M., & Hefeker, C. (2007). Political risk, institutions and foreign direct investment. European Journal of Political Economy, 23, 397-415.
6. Choe, J. II. (2003). Do foreign direct investment and gross domestic investment promote economic growth?. Review of Development Economics, 7(1), 44-57.
7. Campos, E.J., Lien, D. & Pradhan, S.(1999). The impact of corruption on investment: Predictability matters. World Development, 27(6), 1059-1067.
8. Dritsaki, C., & Stiakakis, E. (2014). Foreign direct investment, exports, and economic growth in Croatia: A time series analysis. Procedia Economics and Finance, 14, 181-190.

9. Emirmahmutoğlu, F., & Köse, N. (2011). Testing for Granger causality in heterogeneous mixed panels. Economic Modelling, 28, 870-876.
10. Ericsson, J., & Irandoust, M. (2010). On the causality between foreign direct investment and output: A comparative study. The International Trade Journal, 15(1), 1-26.
11. Gastanaga, V. M., Nugent, J.B.& Pashamova, B. (1998). Host country and FDI ınflows: how much difference do they make?. World Development, 26(7), 1299-1314.
12. Hsio, F.S.T., & Hsiao, M.C.W. (2006). FDI, expots, and GDP in East and Southeast Asia- Panel data versus time-series causality analyses. Journal of Asian Economics, 17, 1082-1106.
13. Kolstad, I. & Villanger, E. (2008). Determinats of foreign direct investment in services. European Journal of Political Economy, 24, 518-533.
14. Kuzmina, O., Volchkova, N., & Zueva, T. (2014). Foreign direct investment and governance quality in Russia. Journal of Comparative Economics, 42, 874-891.
15. Li, X., & Liu, X. (2005). Foreign direct investment and economic growth: An increasingly endogenous relationship. World Development, 33(3), 393-407.
16. Mah, J.S. (2010). Foreign direct investment inflows and economic growth of China. Journal of Policy Modelling, 32, 155-158.
17. Pesaran, M. H. (2007). A Simple Panel Unit Root Test in the Presence of Cross-Section Dependence. Journal of Applied Econometrics, 22, 365-312.
18. Pradhan, R.P. (2009). The FDI-led- growth hypothesis in ASEAN-5 countries: Evidence from cointegrated panel analysis. International Journal of Business and Management, 4(12), 153-164.
19. Stoian, C. (2013). Extending Dunning’s investment development path: the role of home country institutional determinants in explaining outward foreign direct investment. International Business Review, 22, 615-637.
20. Szkorupova, Z. (2014). A causal relationship between foreign direct investment, economic growth and export for Slovakia. Procedia Economics and Finance, 15, 123-128.