The Impact of Foreign Direct Investment on Economic Growth: Evidence from Emerging Markets
Keywords:
Foreign Direct Investment (FDI), Economic Growth, Emerging Markets, GDP GrowthAbstract
Foreign direct investment (FDI) has long been recognized as a significant driver of economic growth, particularly in emerging markets. This paper examines the impact of FDI on economic growth using empirical evidence from a selection of emerging market economies. Through a review of existing literature and econometric analysis, the paper assesses the relationship between FDI inflows and various indicators of economic growth, including GDP growth rates, employment levels, and productivity. The findings suggest that FDI inflows can have a positive impact on economic growth by stimulating investment, creating employment opportunities, transferring technology and knowledge, and fostering innovation and productivity gains. However, the extent of FDI's impact may vary depending on factors such as the host country's institutional framework, market conditions, and policy environment. By understanding the dynamics of FDI and its implications for economic growth, policymakers can formulate strategies to attract and leverage FDI effectively to promote sustainable development and prosperity in emerging markets.
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