Analyzing the impact of foreign direct investment on economic growth in Kenya between 1992-2022

Mwangi Patricia Wairimu (2024) Analyzing the impact of foreign direct investment on economic growth in Kenya between 1992-2022. Külkereskedelmi Kar.

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Absztrakt (kivonat)

Policymakers in advanced and developing countries consent that FDI is a successful development strategy, a driver of competitiveness, and a key to crisis recovery. Most developing countries like Kenya liberalize FDI and increase promotion efforts due to the presumption that the inflows increase the volume of GDP. FDI prospectively fosters economic growth through increasing production in local firms and improving the quality of goods and services produced. At the same time, investment expenditure critically contributes to the production capacity in a country and extensively increases the rate of output growth and employment. However, FDI variedly impacts the economic progress of recipient countries based on their models and stages of development. The inconclusive evidence of FDI benefits in academic literature led to the investigation of the impact of foreign direct investments on the macroeconomic indicators (economic growth and employment) in Kenya from 1992- 2022. The study sourced time series data from World Bank, UNCTADstats, KNBS, and Kenya Economic Surveys. Data was analysed using EViews software statistics and results illustrated through tables. This paper adopted the Vector Error Correction Model (VECM) for regression analysis and Ordinary Least Squares (OLS) in testing hypothesis to understand the connection between exogenous and endogenous variables. The correlation test proved the existence of positive correlation between the three variables. Specifically, employment and GDP annual growth are highly positive correlated, while employment and FDI flows are moderately correlated. The positive correlation among the dependent and independent variables was further supported by the results from the regression analysis. FDI positively and significantly affects GDP growth in Kenya while FDI has an insignificant and positive impact on employment. The study concluded that FDI is a component of economic growth by creating employment and increasing the volume of gross domestic product.

Intézmény

Budapesti Gazdasági Egyetem

Kar

Külkereskedelmi Kar

Tanszék

Nemzetközi Gazdaságtan Tanszék

Tudományterület/tudományág

NEM RÉSZLETEZETT

Szak

Nemzetközi gazdaság és gazdálkodás (angol)

Mű típusa:	diplomadolgozat (NEM RÉSZLETEZETT)
Kulcsszavak:	economic growth, employment, fdi, GDP, investments, Kenya
SWORD Depositor:	Archive User
Felhasználói azonosító szám (ID):	Archive User
Rekord készítés dátuma:	2024. Szep. 26. 08:01
Utolsó módosítás:	2024. Szep. 26. 08:01

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