Impact of Macroeconomic Factors on Foreign Direct Investment (FDI): Evidence from ASEAN Countries
The main objective of this research is to examine the impact of various macroeconomic factors on foreign direct investment (FDI) inflow of the Association of Southeast Asian Nations (ASEAN) member countries. The selected macro-economic factors are gross domestic product (GDP), foreign exchange...
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| Format: | Journal Article |
| Language: | English |
| Published: |
International Journal of Advanced Scientific Research and Management
2017
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| Online Access: | http://ijasrm.com/issues/volume-2-issue-10/ http://hdl.handle.net/20.500.11937/77239 |
| Summary: | The main objective of this research is to examine
the impact of various macroeconomic factors on
foreign direct investment (FDI) inflow of the
Association of Southeast Asian Nations (ASEAN)
member countries. The selected macro-economic
factors are gross domestic product (GDP), foreign
exchange rate and inflation rate and these are
independent variables of the study. FDI is
determining through the amount of inflow during
the study period and it is treated as a dependent
variable. For the analysis the study undertakes the
trend & growth analysis and applied Panel data
analysis for 10 ASEAN countries over the period of
five years from 2009 to 2013.The study conducted
Pooled OLS model and random effect model. To
identify the individual specific effect correlated
with independent variable of the study applied
fixed effect model. Finally the study applied
Hausman test to find out the suitable model among
the random effect and time effect. The result of the
study stated that the trend and growth of FDI
inflow is positive and progressive. The macro
economic factors of GDP and inflation are
significant and impact on FDI inflow, foreign
exchange rate is not significant and there is no
impact on FDI inflow.
Keywords: Foreign Direct Investment,
macroeconomic factors, ASEAN countries,
Gross domestic product (GDP), foreign
exchange rate and inflation rate |
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