FDI and Economic Growth in European Transition Economies: Panel Data Analysis

The main purpose of this paper is to investigate relationship between foreign direct investment and economic growth based on 14 European Transition Economies for the period 1995 to 2014. Empirical model includes GDP per capita growth (% annual), foreign direct investment, net inflows (% GDP) and composite index of control variables which developed with PCA. Firstly homogeneity and cross sectional dependence among units are examined with Delta and tests and it is found that all series have heterogeneity and cross sectional dependency. For that reason, second generation Multifactor error structure (Pesaran et al, 2013) panel unit root test is used and it is also taken into account effect of unobserved common factors as a prerequisite of CCE Model just after proving the co-integration relationship and causality between variables via of Durbin-Hausmann (Westerlund, 2008) co-integration and Dumetriscu-Hurlin (2012) causality tests. Obtained results strongly support one-way causality from foreign direct investments and composite index to economic growth. Unfortunately, there is no causality between foreign direct investments and composite index of control variables. Our findings indicate that foreign direct investments contribute negatively to economic growth in contrast to theory points out but control variables contribute positively at European transition countries.

Tam Metin

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Bibtex	@ { jyasar339647, journal = {Yaşar Üniversitesi E-Dergisi}, issn = {1305-970X}, address = {}, publisher = {Yaşar Üniversitesi}, year = {2017}, volume = {12}, number = {46}, pages = {123 - 135}, title = {FDI and Economic Growth in European Transition Economies: Panel Data Analysis}, key = {cite}, author = {Sağlam, Yağmur} }
APA	Sağlam, Y. (2017). FDI and Economic Growth in European Transition Economies: Panel Data Analysis . Yaşar Üniversitesi E-Dergisi , 12 (46) , 123-135 .
MLA	Sağlam, Y. "FDI and Economic Growth in European Transition Economies: Panel Data Analysis" . Yaşar Üniversitesi E-Dergisi 12 (2017 ): 123-135 <
Chicago	Sağlam, Y. "FDI and Economic Growth in European Transition Economies: Panel Data Analysis". Yaşar Üniversitesi E-Dergisi 12 (2017 ): 123-135
RIS	TY - JOUR T1 - FDI and Economic Growth in European Transition Economies: Panel Data Analysis AU - YağmurSağlam Y1 - 2017 PY - 2017 N1 - DO - T2 - Yaşar Üniversitesi E-Dergisi JF - Journal JO - JOR SP - 123 EP - 135 VL - 12 IS - 46 SN - 1305-970X- M3 - UR - Y2 - 2022 ER -
EndNote	%0 Yaşar Üniversitesi E-Dergisi FDI and Economic Growth in European Transition Economies: Panel Data Analysis %A Yağmur Sağlam %T FDI and Economic Growth in European Transition Economies: Panel Data Analysis %D 2017 %J Yaşar Üniversitesi E-Dergisi %P 1305-970X- %V 12 %N 46 %R %U
ISNAD	Sağlam, Yağmur . "FDI and Economic Growth in European Transition Economies: Panel Data Analysis". Yaşar Üniversitesi E-Dergisi 12 / 46 (Nisan 2017): 123-135 .
AMA	Sağlam Y. FDI and Economic Growth in European Transition Economies: Panel Data Analysis. Yaşar Üniversitesi E-Dergisi. 2017; 12(46): 123-135.
Vancouver	Sağlam Y. FDI and Economic Growth in European Transition Economies: Panel Data Analysis. Yaşar Üniversitesi E-Dergisi. 2017; 12(46): 123-135.
IEEE	Y. Sağlam , "FDI and Economic Growth in European Transition Economies: Panel Data Analysis", , c. 12, sayı. 46, ss. 123-135, Nis. 2017