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Impact of export and gross domestic product towards foreign direct investment inflows in Malaysia

Malaysia has been encouraging Foreign Direct Investment (FDI) inflows not only for its role in technology transfer but also for its economic contribution. Identifying the factors affecting the FDI is important in explaining the Malaysian economy performance. Therefore, the aim of this study is to in...

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Main Authors: Abu Hassan Asari, Fadli Fizari, Shamsudin, Norazidah, Hamid Abd Kadir, Rhaudhah Anis, Baharuddin, Nurul Syuhada, Affandi, Salwani, Jusoff, Kamaruzaman
Format: Article
Language:English
Published: IDOSI Publications 2011
Online Access:http://psasir.upm.edu.my/id/eprint/44548/1/Impact%20of%20export%20and%20gross%20domestic%20product%20towards%20foreign%20direct%20investment%20inflows%20in%20Malaysia.pdf
http://psasir.upm.edu.my/id/eprint/44548/
https://www.idosi.org/wasj/wasj12(BES)2011.htm
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spelling my.upm.eprints.445482020-08-04T02:27:10Z http://psasir.upm.edu.my/id/eprint/44548/ Impact of export and gross domestic product towards foreign direct investment inflows in Malaysia Abu Hassan Asari, Fadli Fizari Shamsudin, Norazidah Hamid Abd Kadir, Rhaudhah Anis Baharuddin, Nurul Syuhada Affandi, Salwani Jusoff, Kamaruzaman Malaysia has been encouraging Foreign Direct Investment (FDI) inflows not only for its role in technology transfer but also for its economic contribution. Identifying the factors affecting the FDI is important in explaining the Malaysian economy performance. Therefore, the aim of this study is to investigate the impact Of Export (EXP) and economic growth on FDI inflows performance in Malaysia for a period of 30 years from 1979 to 2008 using the Vector Error Correction Model (VECM). In this paper, the economic growth shall be denoted by the Gross Domestic Product (GDP). 'Granger no causality test' or mostly know as Causality Test was used to test the direction of causality between the variables whereas Johansen Cointegration Test was employed to gauge the long run relationship. According to the findings, GDP 'granger cause' FDI runs unidirectionally on a short term basis. Johansen test for determining cointegration showed that the GDP has significant positive long run relationship with FDI inflows. In contrast, there was an inverse relationship between EXP and FDI inflows. Results also show that FDI, EXP and the GDP series in Malaysia are I (1) series. In conclusion, the ability of a country in manipulating its' own resources is significant in generating the economic growth. It is recommended for future researchers to include other economic indicators such as interest rate, exchange rate and inflation rate in explaining additional factors contributing to FDI inflows. IDOSI Publications 2011 Article PeerReviewed text en http://psasir.upm.edu.my/id/eprint/44548/1/Impact%20of%20export%20and%20gross%20domestic%20product%20towards%20foreign%20direct%20investment%20inflows%20in%20Malaysia.pdf Abu Hassan Asari, Fadli Fizari and Shamsudin, Norazidah and Hamid Abd Kadir, Rhaudhah Anis and Baharuddin, Nurul Syuhada and Affandi, Salwani and Jusoff, Kamaruzaman (2011) Impact of export and gross domestic product towards foreign direct investment inflows in Malaysia. World Applied Sciences Journal, 12. pp. 27-33. ISSN 1818-4952; ESSN: 1991-6426 https://www.idosi.org/wasj/wasj12(BES)2011.htm
institution Universiti Putra Malaysia
building UPM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Putra Malaysia
content_source UPM Institutional Repository
url_provider http://psasir.upm.edu.my/
language English
description Malaysia has been encouraging Foreign Direct Investment (FDI) inflows not only for its role in technology transfer but also for its economic contribution. Identifying the factors affecting the FDI is important in explaining the Malaysian economy performance. Therefore, the aim of this study is to investigate the impact Of Export (EXP) and economic growth on FDI inflows performance in Malaysia for a period of 30 years from 1979 to 2008 using the Vector Error Correction Model (VECM). In this paper, the economic growth shall be denoted by the Gross Domestic Product (GDP). 'Granger no causality test' or mostly know as Causality Test was used to test the direction of causality between the variables whereas Johansen Cointegration Test was employed to gauge the long run relationship. According to the findings, GDP 'granger cause' FDI runs unidirectionally on a short term basis. Johansen test for determining cointegration showed that the GDP has significant positive long run relationship with FDI inflows. In contrast, there was an inverse relationship between EXP and FDI inflows. Results also show that FDI, EXP and the GDP series in Malaysia are I (1) series. In conclusion, the ability of a country in manipulating its' own resources is significant in generating the economic growth. It is recommended for future researchers to include other economic indicators such as interest rate, exchange rate and inflation rate in explaining additional factors contributing to FDI inflows.
format Article
author Abu Hassan Asari, Fadli Fizari
Shamsudin, Norazidah
Hamid Abd Kadir, Rhaudhah Anis
Baharuddin, Nurul Syuhada
Affandi, Salwani
Jusoff, Kamaruzaman
spellingShingle Abu Hassan Asari, Fadli Fizari
Shamsudin, Norazidah
Hamid Abd Kadir, Rhaudhah Anis
Baharuddin, Nurul Syuhada
Affandi, Salwani
Jusoff, Kamaruzaman
Impact of export and gross domestic product towards foreign direct investment inflows in Malaysia
author_facet Abu Hassan Asari, Fadli Fizari
Shamsudin, Norazidah
Hamid Abd Kadir, Rhaudhah Anis
Baharuddin, Nurul Syuhada
Affandi, Salwani
Jusoff, Kamaruzaman
author_sort Abu Hassan Asari, Fadli Fizari
title Impact of export and gross domestic product towards foreign direct investment inflows in Malaysia
title_short Impact of export and gross domestic product towards foreign direct investment inflows in Malaysia
title_full Impact of export and gross domestic product towards foreign direct investment inflows in Malaysia
title_fullStr Impact of export and gross domestic product towards foreign direct investment inflows in Malaysia
title_full_unstemmed Impact of export and gross domestic product towards foreign direct investment inflows in Malaysia
title_sort impact of export and gross domestic product towards foreign direct investment inflows in malaysia
publisher IDOSI Publications
publishDate 2011
url http://psasir.upm.edu.my/id/eprint/44548/1/Impact%20of%20export%20and%20gross%20domestic%20product%20towards%20foreign%20direct%20investment%20inflows%20in%20Malaysia.pdf
http://psasir.upm.edu.my/id/eprint/44548/
https://www.idosi.org/wasj/wasj12(BES)2011.htm
_version_ 1675328716752814080
score 13.211869

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