The relative importance of trade verses FDI-led economic growth in Thailand

Sailesh Tanna, Kitja Topaiboul, Chengchun Li

Research output: Chapter in Book/Report/Conference proceedingChapter

1 Citation (Scopus)

Abstract

This chapter investigates the relative strength of the contributions of trade
openness and FDI inflows towards economic growth of Thailand, taking account
of the importance of human capital and other conditioning factors as a source of
technology transfer in facilitating growth. Using Granger causality tests conducted within a vector-error-correction framework, the authors find significant evidence of the complementarities between domestic investment and trade openness, providing support for import-led growth. In contrast, direct support for FDI-led growth is relatively weak, which implies that trade openness has played a more significant role than FDI in influencing Thai economic growth. However, the results reveal a subtle role for technology transfer through the complementary effect of trade on FDI, and FDI on government expenditure, which henceforth influences human capital development with spillovers into domestic investment and growth. This leads us to argue that there is a potential role for FDI interacting with human capital in influencing the future development of the Thai economy, given its active policy of FDI promotion over the past decade.
Original languageEnglish
Title of host publicationForeign Direct Investments (FDIs) and Opportunities for Developing Economies in the World Market
EditorsV Malepati, C.M. Gowri
Place of PublicationHershey PA, USA
PublisherIGI Global
Pages105-122
Number of pages18
ISBN (Electronic)9781522530275
ISBN (Print)9781522530268
DOIs
Publication statusPublished - 1 Jan 2018

Fingerprint

Relative importance
Economic growth
Thailand
Domestic investment
Human capital
Trade openness
Government expenditure
Vector error correction
Technology transfer
Spillover
Human capital development
Import
Granger causality test
Factors
Conditioning
Complementarity

Keywords

  • Foreign direct investment
  • Trade
  • Economic growth
  • Thailand
  • vector error correction model
  • cointegration

Cite this

Tanna, S., Topaiboul, K., & Li, C. (2018). The relative importance of trade verses FDI-led economic growth in Thailand. In V. Malepati, & C. M. Gowri (Eds.), Foreign Direct Investments (FDIs) and Opportunities for Developing Economies in the World Market (pp. 105-122). Hershey PA, USA: IGI Global. https://doi.org/10.4018/978-1-5225-3026-8.ch006

The relative importance of trade verses FDI-led economic growth in Thailand. / Tanna, Sailesh; Topaiboul, Kitja; Li, Chengchun.

Foreign Direct Investments (FDIs) and Opportunities for Developing Economies in the World Market. ed. / V Malepati; C.M. Gowri. Hershey PA, USA : IGI Global, 2018. p. 105-122.

Research output: Chapter in Book/Report/Conference proceedingChapter

Tanna, S, Topaiboul, K & Li, C 2018, The relative importance of trade verses FDI-led economic growth in Thailand. in V Malepati & CM Gowri (eds), Foreign Direct Investments (FDIs) and Opportunities for Developing Economies in the World Market. IGI Global, Hershey PA, USA, pp. 105-122. https://doi.org/10.4018/978-1-5225-3026-8.ch006
Tanna S, Topaiboul K, Li C. The relative importance of trade verses FDI-led economic growth in Thailand. In Malepati V, Gowri CM, editors, Foreign Direct Investments (FDIs) and Opportunities for Developing Economies in the World Market. Hershey PA, USA: IGI Global. 2018. p. 105-122 https://doi.org/10.4018/978-1-5225-3026-8.ch006
Tanna, Sailesh ; Topaiboul, Kitja ; Li, Chengchun. / The relative importance of trade verses FDI-led economic growth in Thailand. Foreign Direct Investments (FDIs) and Opportunities for Developing Economies in the World Market. editor / V Malepati ; C.M. Gowri. Hershey PA, USA : IGI Global, 2018. pp. 105-122
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