Year 2017, Volume 1, Issue 3, Pages 56 - 67 2017-09-30

Does FDI Affect Social Protests Level?: Panel Granger Causality Test

Deniz GÜVERCİN [1]

191 230

FDI as an the extension of  foreign economic units has significant economic and political impacts on host country. The literature focusing on the political determinants of the FDI inflows does not put emphasis on whether FDI can redetermine the level of political rights, social protests,  riots in the host country. This study brings new insight by adding the relevant literature the issue of the impact of FDI on social protests level in the host countries by bringing the cross country evidence. I refer in the paper some channels through which FDI can affect social demonstrations. The main channel, along with others, I emphasize that if  the growth-enhancing FDI keeps flowing and creating economic growth, voters get more  motivated to vote for the incumbent party. I argue that incumbent government to draw benefits out of strong economic record pumped by FDI inflows, releases the restrictions on the political rights, and eases the harsh repression to avoid political uncertainty which decreases the level of collective action problem and increase the social protest levels. Dumitrescu & Hurlin Panel Granger test is implemented to test FDI-Social protest causality using the relevant data of six European countries. Test results indicate that there is bi-directional causality running from FDI to Social protest level that implies that FDI has an impact on protest level in the host country.

FDI, Social Protests, Collective Action Problem, Dumitrescu & Hurlin Panel Granger test
  • Borensztein E., J.De Gregorio and J-W Lee, 1998, “How does foreign direct investment affect economic growth”, Journal of International Economics, 45(1), 115-135
  • Busse M., Hefeker C., 2005, “Political Risk, Institutions and Foreign Direct Investment,
  • HWWA Discussion Paper 315, Hamburg Institute of International Economics
  • Dumitrescu I., Hurlin C., 2012, “Testing for Granger non-causality in heterogenous panels”,
  • Economic Modelling, 29(4), 1450-1460
  • Dutta N., Roy S., 2009, “The Role of Direct Investment on Press Freedom”, Kyklos, 62(2), 239-257
  • European Protest and Coercion Data, web.ku.edu/~rofrand/data
  • Greider W., 1998, One World, Ready or Not: The Manic Logic of Global Capitalism, Newyork:Touchstone
  • Harms P., and Ursprung H., 2002, “ Do Civil and Political Repression Really Boost Foreign Direct Investment”, Economic Inquiry,40(4), 651-663.
  • Holtz-Eakin D., Newey E., Rosen H., 1988, “Estimating Vector Autoregressions With Panel Data”, Econometrica, 56(6)
  • Kalemli-Ozcan S., Sayek S., Chanda A., Alfaro L., 2004, “FDI and Economic Growth: The Role of Local Financial Markets, Journal of International Economics, 64(1),89-112
Subjects Social
Journal Section Articles
Authors

Author: Deniz GÜVERCİN
Country: Turkey


Bibtex @research article { fsecon326770, journal = {Fiscaoeconomia}, issn = {}, eissn = {2564-7504}, address = {Ahmet Arif EREN}, year = {2017}, volume = {1}, pages = {56 - 67}, doi = {10.25295/fsecon.326770}, title = {Does FDI Affect Social Protests Level?: Panel Granger Causality Test}, key = {cite}, author = {GÜVERCİN, Deniz} }
APA GÜVERCİN, D . (2017). Does FDI Affect Social Protests Level?: Panel Granger Causality Test. Fiscaoeconomia, 1 (3), 56-67. DOI: 10.25295/fsecon.326770
MLA GÜVERCİN, D . "Does FDI Affect Social Protests Level?: Panel Granger Causality Test". Fiscaoeconomia 1 (2017): 56-67 <http://dergipark.org.tr/fsecon/issue/31372/326770>
Chicago GÜVERCİN, D . "Does FDI Affect Social Protests Level?: Panel Granger Causality Test". Fiscaoeconomia 1 (2017): 56-67
RIS TY - JOUR T1 - Does FDI Affect Social Protests Level?: Panel Granger Causality Test AU - Deniz GÜVERCİN Y1 - 2017 PY - 2017 N1 - doi: 10.25295/fsecon.326770 DO - 10.25295/fsecon.326770 T2 - Fiscaoeconomia JF - Journal JO - JOR SP - 56 EP - 67 VL - 1 IS - 3 SN - -2564-7504 M3 - doi: 10.25295/fsecon.326770 UR - https://doi.org/10.25295/fsecon.326770 Y2 - 2017 ER -
EndNote %0 Fiscaoeconomia Does FDI Affect Social Protests Level?: Panel Granger Causality Test %A Deniz GÜVERCİN %T Does FDI Affect Social Protests Level?: Panel Granger Causality Test %D 2017 %J Fiscaoeconomia %P -2564-7504 %V 1 %N 3 %R doi: 10.25295/fsecon.326770 %U 10.25295/fsecon.326770
ISNAD GÜVERCİN, Deniz . "Does FDI Affect Social Protests Level?: Panel Granger Causality Test". Fiscaoeconomia 1 / 3 (September 2017): 56-67. https://doi.org/10.25295/fsecon.326770