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Economic convergence amongst ECOWAS member countries: The role of foreign direct investment

The phenoma of per capita income convergence has a lot of welfare implications. FDI is identified as a principal candidate for technology transfer to developing countries. However, the distribution of FDI is observed to be highly skewed in favour of limited number of countries. Africa in general, an...

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Main Author: Musa, Murtala
Format: Thesis
Language:English
English
Published: 2016
Subjects:
HB Economic Theory
Online Access:https://etd.uum.edu.my/6195/1/s96050_01.pdf
https://etd.uum.edu.my/6195/2/s96050_02.pdf
https://etd.uum.edu.my/6195/
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spelling my.uum.etd.61952023-03-09T02:42:48Z https://etd.uum.edu.my/6195/ Economic convergence amongst ECOWAS member countries: The role of foreign direct investment Musa, Murtala HB Economic Theory The phenoma of per capita income convergence has a lot of welfare implications. FDI is identified as a principal candidate for technology transfer to developing countries. However, the distribution of FDI is observed to be highly skewed in favour of limited number of countries. Africa in general, and ECOWAS in particular, perfromed poorly in FDI attraction compared to other countries. ECOWAS is also characterized by huge within group gap both in terms of FDI and real GDP per capita. Using data spanning from 1970 – 2014, this study investigates the relationship between real GDP per capita and FDI for a sample of 15 ECOWAS countries. The study employs SURADF procedure to investigate on absolute convergence within each income group as well as convergence within ECOWAS at large. It is observed that seven economies tend to converge to the group average real GDP per capita, of which only one is a low-income. On the speed of convergence, the study reveals that relatively poor economies tend to catch up with relatively richer economies in the group at 1.10 percent, a rate considered very slow. The study further reveals that FDI plays a significant role in facilitating per capita income convergence amongst ECOWAS member states. Investigation of the role of FDI in attaining across group convergence for ECOWAS and each income group also yields results showing a sharp difference between the two income groups. Low income countries have positive and significant relationship between FDI and convergence as opposed to the case of lower middle income. The policy implications of these findings is that ECOWAS countries need to implement policies that would aid FDI attraction as well as ensure adequate absorptive capacity, which is an important condition to reap the benefits of FDI. 2016 Thesis NonPeerReviewed text en https://etd.uum.edu.my/6195/1/s96050_01.pdf text en https://etd.uum.edu.my/6195/2/s96050_02.pdf Musa, Murtala (2016) Economic convergence amongst ECOWAS member countries: The role of foreign direct investment. PhD. thesis, Universiti Utara Malaysia.
institution Universiti Utara Malaysia
building UUM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Utara Malaysia
content_source UUM Electronic Theses
url_provider http://etd.uum.edu.my/
language English
English
topic HB Economic Theory
spellingShingle HB Economic Theory
Musa, Murtala
Economic convergence amongst ECOWAS member countries: The role of foreign direct investment
description The phenoma of per capita income convergence has a lot of welfare implications. FDI is identified as a principal candidate for technology transfer to developing countries. However, the distribution of FDI is observed to be highly skewed in favour of limited number of countries. Africa in general, and ECOWAS in particular, perfromed poorly in FDI attraction compared to other countries. ECOWAS is also characterized by huge within group gap both in terms of FDI and real GDP per capita. Using data spanning from 1970 – 2014, this study investigates the relationship between real GDP per capita and FDI for a sample of 15 ECOWAS countries. The study employs SURADF procedure to investigate on absolute convergence within each income group as well as convergence within ECOWAS at large. It is observed that seven economies tend to converge to the group average real GDP per capita, of which only one is a low-income. On the speed of convergence, the study reveals that relatively poor economies tend to catch up with relatively richer economies in the group at 1.10 percent, a rate considered very slow. The study further reveals that FDI plays a significant role in facilitating per capita income convergence amongst ECOWAS member states. Investigation of the role of FDI in attaining across group convergence for ECOWAS and each income group also yields results showing a sharp difference between the two income groups. Low income countries have positive and significant relationship between FDI and convergence as opposed to the case of lower middle income. The policy implications of these findings is that ECOWAS countries need to implement policies that would aid FDI attraction as well as ensure adequate absorptive capacity, which is an important condition to reap the benefits of FDI.
format Thesis
author Musa, Murtala
author_facet Musa, Murtala
author_sort Musa, Murtala
title Economic convergence amongst ECOWAS member countries: The role of foreign direct investment
title_short Economic convergence amongst ECOWAS member countries: The role of foreign direct investment
title_full Economic convergence amongst ECOWAS member countries: The role of foreign direct investment
title_fullStr Economic convergence amongst ECOWAS member countries: The role of foreign direct investment
title_full_unstemmed Economic convergence amongst ECOWAS member countries: The role of foreign direct investment
title_sort economic convergence amongst ecowas member countries: the role of foreign direct investment
publishDate 2016
url https://etd.uum.edu.my/6195/1/s96050_01.pdf
https://etd.uum.edu.my/6195/2/s96050_02.pdf
https://etd.uum.edu.my/6195/
_version_ 1761621566237442048
score 13.244369

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