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Title Impact of Foreign Capital Inflows on Economic Growth of Developing Countries

Author(s) Mr. Mansoor Abbas

Abstract This thesis examines the outcome of foreign capital inflows (FCI) on economic growth of selected developing countries for the period of 1984 to 2016. Foreign Capital Inflow consists of remittances, official development assistance (ODA) and foreign direct investment (FDI). The data for analysis is taken from world bank development index. This thesis analyzes the relationship between FCI and economic growth in developing countries by using Production Function that is based on Exogenous and Endogenous growth theories. For this purpose, labor force (LF), inflation, gross capital formation (GCF), imports, and exports are included in the model. The study analyzes descriptively and graphically the FCI, economic growth and all other variables which are used in the model. This thesis tests the relation between FCI and economic growth of the selected developing countries empirically by applying the Random Effect Model (REM) and Fixed Effect Model (FEM) as all variables are stationary at level. The result shows a positive and statistically effect of FCI on economic growth. The other determinants that are labor force, gross capital formation and exports have also positive and significant effect on economic growth for all selected developing countries. This thesis also analyzes the impact of FCI on growth separately for low income countries, lower middle-income countries and upper middle-income countries separately. The Overall countries, lower income countries and upper middle countries result show a positive and significant relationship between FCI and economic growth, but the low-income countries result shows insignificant relationship.

Type Thesis/Dissertation PhD

Faculty Management Sciences

Department Economics

Language English

Publication Date 2019-08-27

Subject Economics

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