چکیده:
This study applied panel unit root, panel co-integration and panel causality tests to distinguish the position of short run and long run causality among foreign direct investment (FDI) and trade in a panel of 16 advanced European countries over the period 1976-2008, 528 observations were incorporated into the model. The results show that there is bidirectional causality among FDI-Export and FDI-Import in the short run while the long run causality runs from import and export to FDI. Furthermore, there is unidirectional causality from FDI to total trade in the long run and bidirectional causality in the short run. Therefore, increase in FDI led to increase in export and import in the short run and these led to increase in total trade in the short run. Thus, attractive FDI policies in trade oriented economies can be used to promote the level of trade, and expanding trade policies are helpful as well to attract more FDI in these set of countries.
خلاصه ماشینی:
"Panel Causality Relationship among FDI and Trade (Evidence from 16 Advanced Europe Countries) Farshid Pourshahabi 1 Ehsan Salimi Soderjani 2 Davood Mahmoudinia 3 Received: 2012/04/30 Accepted: 2012/10/11 Abstract This study applied panel unit root, panel co-integration and panel causality tests to distinguish the position of short run and long run causality among foreign direct investment (FDI) and trade in a panel of 16 advanced European countries over the period 1976-2008, 528 observations were incorporated into the model.
Jayachandran & Seilan (2010) investigated the relationship among Trade, Foreign Direct Investment (FDI) and economic growth for India over the period 1970-2007.
In this paper, we examine the short run and long run causality relationship among foreign direct investment (FDI) and export, import and total trade (export plus import) in 16 advanced Europe countries over the period 1976-2008.
Thus, at first MNE will typically export to serve the domestic market in a host country because trade is easier and less risky than FDI, and after learning more about the economic, political, and social conditions and gaining more experience, home country firms may set up an affiliate to serve that market directly.
The LLC and IPS statistics for the levels and first difference of gross domestic product, FDI, export, import and Trade in logarithmic forms show that all the variables are integrated of order one or I(1)."