Quest for Sustainable Growth, Does Foreign Direct Investment Still Matter? Evidence in Africa

Authors

  • Adewosi, O. Adegoke
  • Manu Donga
  • Adamu Idi

DOI:

https://doi.org/10.52131/pjhss.2019.0704.0095

Keywords:

Economic Growth, Foreign Direct Investment, Rule of Law, Africa, Panel Data

Abstract

The debate on the role of Foreign Direct Investment in promoting rapid growth and development of the developing economies remain inconclusive. This paper examined whether FDI still matters in African Countries over the period of 1990 to 2017, with the proper utilization of panel data estimation technique on the annual country data that were sourced from world Governance and Development Indicators. Using random and fixed effect model, the results reveal that some important variables such as coefficient of trade openness, rule of law, political stability, capital formation and population positively determined economic growth in Africa countries, account for about 2, 1, 65, 170, and 396.7 percent increase in economic growth. While, FDI and inflation were found to have negative impact on economic growth accounting for 21.4 and 2 percent fall in economic growth over the study period. The study then recommends amongst others formulation and implementation of policies that encourage domestic investment in the continents.

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Author Biographies

Adewosi, O. Adegoke

Department of Economics, Modibbo Adama University of Technology, Yola,

Manu Donga

Department of Economics, Modibbo Adama University of Technology, Yola,

Adamu Idi

Department of Economics, Gombe State University

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Published

2019-12-31

How to Cite

Adegoke, A. O., Donga, M., & Idi, A. (2019). Quest for Sustainable Growth, Does Foreign Direct Investment Still Matter? Evidence in Africa. Pakistan Journal of Humanities and Social Sciences, 7(4), 397–409. https://doi.org/10.52131/pjhss.2019.0704.0095

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Section

Articles