FOREIGN DIRECT INVESTMENT, ECONOMIC GROWTH AND TRADE OPENNESS IN INDIA: A TIME SERIES ANALYSISJournal: International Journal of Advanced Research in Engineering and Technology (IJARET) (Vol.11, No. 12)
Publication Date: 2020-12-31
Authors : Endhumathi Manoharan S. Vanitha;
Page : 677-686
Keywords : FDI; Economic growth; Trade openness; Causality; India;
The present study investigated the causal relation among foreign direct investment, economic growth and trade openness in India for the period 1970–2019. Johansen Cointegration test indicates the presence of long-run association among the variables. The results of vector error correction model indicated the presence of long-run causality runs from FDI to GDP and trade openness. Moreover, the empirical evidence revealed short-run unidirectional causality from economic growth to FDI and the bidirectional causality among trade openness and FDI in the short-run. The findings were constant, as Indian economy has been undergoing a steady economic growth during the few decades and the volume of FDI also surged to substantial extent with minor leaps and bounds. has increased to a significant extent with minor leaps and bounds.
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