Manufacturing FDI and Economic Growth: Evidence from Asian Economies
30 Pages Posted: 6 Oct 2003
This paper studies the impacts of different sector-level foreign direct investment (FDI) inflows on host country's economic growth. Data in 12 Asian economies over the period of 1987-1997 are employed. The empirical results show that FDI in manufacturing sector has a significant and positive effect on economic growth in the host economies. FDI inflows in non-manufacturing sectors do not play a significant role in enhancing economic growth. Furthermore, without the decomposition of total FDI inflows, the effect from FDI on host country's economic growth is possibly underestimated in previous literature.
Keywords: FDI, economic growth
JEL Classification: F21, F43
Suggested Citation: Suggested Citation
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By Ilhan Ozturk