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A Causal Relationship Between Trade, Foreign Direct Investment and Economic Growth in Niger Cover

A Causal Relationship Between Trade, Foreign Direct Investment and Economic Growth in Niger

Open Access
|Feb 2020

Abstract

Foreign direct investment and Trade were regarded as an important elements in enhancing economic development. This study used some time series econometric tests including the Augmented Dickey – Fuller (ADF) unit root test developed by Dickey – Fuller, stationary test developed by Kwiatkowski-Philips-Schmidt-Shin (KPSS), Johansen co-integration test and Granger causality test to analyse the connection between foreign direct investment, trade and economic growth in Niger. The tests results showed a bilateral relationship between trade and economic growth and a unidirectional causal relationship between trade and foreign direct investment with direction from trade to foreign direct investment. The long run effect tests revealed that trade has a positive effect on economic growth while foreign direct investment has a negative effect on economic growth in Niger. On average, ceteris paribus, the coefficients are statistically significant at 5% level.

Language: English
Page range: 24 - 38
Published on: Feb 1, 2020
Published by: Bucharest University of Economic Studies
In partnership with: Paradigm Publishing Services
Publication frequency: 2 issues per year

© 2020 Issoufou Oumarou, Ousseini A. Maiga, published by Bucharest University of Economic Studies
This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.