An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh

Shahjahan Ali; Md. Rukunujjaman; Khandaker Jahangir Alam

doi:doi:10.11648/j.ijber.20150401.11

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An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh

Shahjahan Ali, Md. Rukunujjaman, Khandaker Jahangir Alam

Published in International Journal of Business and Economics Research (Volume 4, Issue 1)

Received: 11 December 2014 Accepted: 18 December 2014 Published: 20 January 2015

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Abstract

Foreign Direct Investment (FDI) is assumed to benefit a poor country like Bangladesh, not only by supplementing domestic investment, but also in terms of employment creation, transfer of technology, increased domestic competition and other positive externalities. This paper focuses on the FDI-led growth hypothesis in the case of Bangladesh. The study is based on time series data from 1973 to 2013. The econometric framework of cointegration and error correction mechanism were used to capture two way linkages between variables interest. It is evident in the results that the regression analyses do not provide much support for the view of a robust link between FDI and growth in Bangladesh. It does not imply that FDI is insignificant. Rather, its analysis reduces the confidence in the belief that FDI has exerted an independent growth effect in Bangladesh. But net attitudes of the civil society on the impact of FDI on opportunities for domestic business and economic activities is positive and net attitudes of foreign firms toward FDI reveals that the investment climate has not improved in Bangladesh as a result of lack of good governance, corruption, political instability and disturbance, bureaucratic inertia, and poor low and order situation.

Published in	International Journal of Business and Economics Research (Volume 4, Issue 1)
DOI	10.11648/j.ijber.20150401.11
Page(s)	1-10
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2015. Published by Science Publishing Group

Keywords

Foreign Direct Investment, Economic Growth, Cointegration, Granger Causality, Bangladesh

References

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APA Style

Shahjahan Ali, Md. Rukunujjaman, Khandaker Jahangir Alam. (2015). An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh. International Journal of Business and Economics Research, 4(1), 1-10. https://doi.org/10.11648/j.ijber.20150401.11

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ACS Style

Shahjahan Ali; Md. Rukunujjaman; Khandaker Jahangir Alam. An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh. Int. J. Bus. Econ. Res. 2015, 4(1), 1-10. doi: 10.11648/j.ijber.20150401.11

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AMA Style

Shahjahan Ali, Md. Rukunujjaman, Khandaker Jahangir Alam. An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh. Int J Bus Econ Res. 2015;4(1):1-10. doi: 10.11648/j.ijber.20150401.11

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@article{10.11648/j.ijber.20150401.11,
  author = {Shahjahan Ali and Md. Rukunujjaman and Khandaker Jahangir Alam},
  title = {An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh},
  journal = {International Journal of Business and Economics Research},
  volume = {4},
  number = {1},
  pages = {1-10},
  doi = {10.11648/j.ijber.20150401.11},
  url = {https://doi.org/10.11648/j.ijber.20150401.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijber.20150401.11},
  abstract = {Foreign Direct Investment (FDI) is assumed to benefit a poor country like Bangladesh, not only by supplementing domestic investment, but also in terms of employment creation, transfer of technology, increased domestic competition and other positive externalities. This paper focuses on the FDI-led growth hypothesis in the case of Bangladesh. The study is based on time series data from 1973 to 2013. The econometric framework of cointegration and error correction mechanism were used to capture two way linkages between variables interest. It is evident in the results that the regression analyses do not provide much support for the view of a robust link between FDI and growth in Bangladesh. It does not imply that FDI is insignificant. Rather, its analysis reduces the confidence in the belief that FDI has exerted an independent growth effect in Bangladesh. But net attitudes of the civil society on the impact of FDI on opportunities for domestic business and economic activities is positive and net attitudes of foreign firms toward FDI reveals that the investment climate has not improved in Bangladesh as a result of lack of good governance, corruption, political instability and disturbance, bureaucratic inertia, and poor low and order situation.},
 year = {2015}
}

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TY  - JOUR
T1  - An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh
AU  - Shahjahan Ali
AU  - Md. Rukunujjaman
AU  - Khandaker Jahangir Alam
Y1  - 2015/01/20
PY  - 2015
N1  - https://doi.org/10.11648/j.ijber.20150401.11
DO  - 10.11648/j.ijber.20150401.11
T2  - International Journal of Business and Economics Research
JF  - International Journal of Business and Economics Research
JO  - International Journal of Business and Economics Research
SP  - 1
EP  - 10
PB  - Science Publishing Group
SN  - 2328-756X
UR  - https://doi.org/10.11648/j.ijber.20150401.11
AB  - Foreign Direct Investment (FDI) is assumed to benefit a poor country like Bangladesh, not only by supplementing domestic investment, but also in terms of employment creation, transfer of technology, increased domestic competition and other positive externalities. This paper focuses on the FDI-led growth hypothesis in the case of Bangladesh. The study is based on time series data from 1973 to 2013. The econometric framework of cointegration and error correction mechanism were used to capture two way linkages between variables interest. It is evident in the results that the regression analyses do not provide much support for the view of a robust link between FDI and growth in Bangladesh. It does not imply that FDI is insignificant. Rather, its analysis reduces the confidence in the belief that FDI has exerted an independent growth effect in Bangladesh. But net attitudes of the civil society on the impact of FDI on opportunities for domestic business and economic activities is positive and net attitudes of foreign firms toward FDI reveals that the investment climate has not improved in Bangladesh as a result of lack of good governance, corruption, political instability and disturbance, bureaucratic inertia, and poor low and order situation.
VL  - 4
IS  - 1
ER  -

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Author Information

Shahjahan Ali

MSS student, Department of Economics, Begum Rokeya University, Rangpur, Bangladesh
Md. Rukunujjaman

MSS student, Department of Economics, Begum Rokeya University, Rangpur, Bangladesh
Khandaker Jahangir Alam

Assistant Professor, Department of Economics, Begum Rokeya University, Rangpur, Bangladesh

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Plain Text BibTeX RIS

APA Style

Shahjahan Ali, Md. Rukunujjaman, Khandaker Jahangir Alam. (2015). An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh. International Journal of Business and Economics Research, 4(1), 1-10. https://doi.org/10.11648/j.ijber.20150401.11

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ACS Style

Shahjahan Ali; Md. Rukunujjaman; Khandaker Jahangir Alam. An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh. Int. J. Bus. Econ. Res. 2015, 4(1), 1-10. doi: 10.11648/j.ijber.20150401.11

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AMA Style

Shahjahan Ali, Md. Rukunujjaman, Khandaker Jahangir Alam. An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh. Int J Bus Econ Res. 2015;4(1):1-10. doi: 10.11648/j.ijber.20150401.11

Copy | Download

@article{10.11648/j.ijber.20150401.11,
  author = {Shahjahan Ali and Md. Rukunujjaman and Khandaker Jahangir Alam},
  title = {An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh},
  journal = {International Journal of Business and Economics Research},
  volume = {4},
  number = {1},
  pages = {1-10},
  doi = {10.11648/j.ijber.20150401.11},
  url = {https://doi.org/10.11648/j.ijber.20150401.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijber.20150401.11},
  abstract = {Foreign Direct Investment (FDI) is assumed to benefit a poor country like Bangladesh, not only by supplementing domestic investment, but also in terms of employment creation, transfer of technology, increased domestic competition and other positive externalities. This paper focuses on the FDI-led growth hypothesis in the case of Bangladesh. The study is based on time series data from 1973 to 2013. The econometric framework of cointegration and error correction mechanism were used to capture two way linkages between variables interest. It is evident in the results that the regression analyses do not provide much support for the view of a robust link between FDI and growth in Bangladesh. It does not imply that FDI is insignificant. Rather, its analysis reduces the confidence in the belief that FDI has exerted an independent growth effect in Bangladesh. But net attitudes of the civil society on the impact of FDI on opportunities for domestic business and economic activities is positive and net attitudes of foreign firms toward FDI reveals that the investment climate has not improved in Bangladesh as a result of lack of good governance, corruption, political instability and disturbance, bureaucratic inertia, and poor low and order situation.},
 year = {2015}
}

Copy | Download

TY  - JOUR
T1  - An Empirical Analysis of Foreign Direct Investment and Economic Growth in Bangladesh
AU  - Shahjahan Ali
AU  - Md. Rukunujjaman
AU  - Khandaker Jahangir Alam
Y1  - 2015/01/20
PY  - 2015
N1  - https://doi.org/10.11648/j.ijber.20150401.11
DO  - 10.11648/j.ijber.20150401.11
T2  - International Journal of Business and Economics Research
JF  - International Journal of Business and Economics Research
JO  - International Journal of Business and Economics Research
SP  - 1
EP  - 10
PB  - Science Publishing Group
SN  - 2328-756X
UR  - https://doi.org/10.11648/j.ijber.20150401.11
AB  - Foreign Direct Investment (FDI) is assumed to benefit a poor country like Bangladesh, not only by supplementing domestic investment, but also in terms of employment creation, transfer of technology, increased domestic competition and other positive externalities. This paper focuses on the FDI-led growth hypothesis in the case of Bangladesh. The study is based on time series data from 1973 to 2013. The econometric framework of cointegration and error correction mechanism were used to capture two way linkages between variables interest. It is evident in the results that the regression analyses do not provide much support for the view of a robust link between FDI and growth in Bangladesh. It does not imply that FDI is insignificant. Rather, its analysis reduces the confidence in the belief that FDI has exerted an independent growth effect in Bangladesh. But net attitudes of the civil society on the impact of FDI on opportunities for domestic business and economic activities is positive and net attitudes of foreign firms toward FDI reveals that the investment climate has not improved in Bangladesh as a result of lack of good governance, corruption, political instability and disturbance, bureaucratic inertia, and poor low and order situation.
VL  - 4
IS  - 1
ER  -

Copy | Download