Relationship between Economic Freedom and Foreign Direct Investment: Panel Cointegration Analysis
Journal: Business and Economics Research Journal (BERJ) (Vol.10, No. 2)Publication Date: 2019-04-03
Authors : Emrah Sofuoglu Oktay Kizilkaya Dogan Uysal;
Page : 341-355
Keywords : Economic Freedom; FDI; FMOLS; DOLS; Panel Data Analysis;
Abstract
Economic freedoms have recently become one of the most important institutional indicators that attracted the attention of researchers. The level of economic freedom of a country is thought to be an important factor in attracting investments. This study aims to examine the relationship between economic freedom and foreign direct investment. In this context, countries need to establish efficient policies for economic freedoms to increase foreign direct investments. To this extent, most attractive foreign direct investment countries (The U.S, Hong Kong, China, Ireland, Netherlands, Switzerland, Singapore, Brazil, Canada and India) are investigated in the study. The study covers the period 1995-2015 and Pedroni cointegration test, panel FMOLS and panel DOLS methods are utilised to determine the relationship between the variables. According to analysis findings, there is a long-term relationship between economic freedom and foreign direct investment. In addition, both panel FMOLS and DOLS results indicate that economic freedom has a positive impact on foreign direct investment in the long term. These findings are evaluated and some policy recommendations are suggested in the conclusion part.
Other Latest Articles
- Investigation of Environmental Kuznets Curve Hypothesis with Non-Additive Fixed Effect Panel Quantile Method
- The Bank Lending Channel of Monetary Transmission in Turkey
- Do German Green Mutual Funds Perform Better Than Their Peers?
- BUILDING A MODEL OF STRATEGIC FINANCIAL PLANNING FOR AN ORGANIZATION
- ECONOMIC AND LEGAL COMPONENT OF MORTGAGE MARKET DEVELOPMENT IN UKRAINE
Last modified: 2019-05-17 09:17:05