FOREIGN DIRECT INVESTMENT AND ECONOMIC GROWTH IN DEVELOPING COUNTRIES: PANEL ESTIMATION FOR SUB-SAHARAN AFRICAN COUNTRIES
 /  FOREIGN DIRECT INVESTMENT AND ECONOMIC GROWTH IN DEVELOPING COUNTRIES: PANEL ESTIMATION FOR SUB-SAHARAN AFRICAN COUNTRIES

FOREIGN DIRECT INVESTMENT AND ECONOMIC GROWTH IN DEVELOPING COUNTRIES: PANEL ESTIMATION FOR SUB-SAHARAN AFRICAN COUNTRIES


ADEDEJI, GBADEBO D. & AHURU ROLLE R.

Abstract
It has been widely claimed that foreign direct investment (FDI)
stimulates economic growth. In this study, an attempt is made to verify
this for ten selected Sub-Saharan African (SSA) countries using data
spanning from 2008 to 2013 obtained from world development
indicators. Preliminary analysis conducted indicates that the regression
assumption tests as the ARCH test for heteroscedasticity, the Lagrangian
multiplier test for higher autocorrelation and the Ramsey Reset test for
mis-specification of models show that ordinary least square (OLS)
estimation is appropriate. The result of panel multiple regression analysis
using the pooled OLS, fixed and random effects is reported. The
Hausman‘s test shows that the fixed effect model is more reliable. The
findings reveal that though FDI positively stimulate growth in SSA but it
is not a significant determinant of growth performance in SSA. The
study recommends that SSA countries should endeavour to increase their
share of world‘s FDI through the use of appropriate and responsive
policies.

Journal Article
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Creative Commons LicenseCreative Commons license
Economics
Economics
FDI, Growth, and Panel Least Square Introduction
Christian Bassey
18th April, 2018
18th April, 2018
http://oer.mciu.edu.ng/wp-content/uploads/2015/04/Rolle-Remi-Ahuru-11.pdf


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