INVESTIGATION OF THE RELATIONSHIP BETWEEN ECONOMIC GROWTH AND FOREIGN DIRECT INVESTMENT WITH PANEL SIMULTANEOUS EQUATION SYSTEM

Abstract

Mutual relationship between foreign investment and economic growth is an issue that is often examined in both theoretical and practical work. Relationship varied according to the countries? level of development is discussed with time series and panel data for OECD countries in the study. Correlation between foreign direct investment and economic growth is estimated with time series and panel simultaneous equations systems. The results vary, although the relationship between foreign direct investment-economic growths for each country, such as all the OECD countries there is positive correlation exists between variables.