Growth effects of FDI and portfolio investment flows to developing countries: A disaggregated analysis by income levels

Glauco De Vita, Khine S. Kyaw

Research output: Contribution to journalArticle

27 Citations (Scopus)

Abstract

What is the impact of foreign direct investment (FDI) and portfolio investment flows on the economic growth of low-, lower middle- and upper middle-income countries? In this article we address this question using a dynamic panel model and a large data set of 126 developing countries for the period 1985 to 2002. Employing the system-generalized methods of moments (GMM) estimation approach, our findings suggest that only developing countries that have reached a minimum level of economic development and absorptive capacity are capturing the growth-enhancing effects of both forms of investment inflows.
Original languageEnglish
Pages (from-to)277-283
Number of pages7
JournalApplied Economics Letters
Volume16
Issue number3
DOIs
Publication statusPublished - 2009

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