Abstract
This paper pursued with the objective of investigating short-term dynamics and equilibrium relations between the two countries in south Asia - India and Pakistan. The main focus of the study is on analyzing patterns of inward Foreign Direct Investment (FDI)in Indian sub-continents. The sample involves yearly time series Foreign Direct Investment (FDI) data from 1980 until 2011. The study employs Engle-Granger Co-integration test, Augmented Dickey- Fuller (ADF) test and Error Correction Modeling (ECM). Empirical results show a significant long-term and the short run relationship between India and Pakistan while to consider India inward FDI as a dependent variable. The finding has one clear implication, that there is a bi-directional relationship involving Foreign Direct Investment (FDI) in India and Pakistan. Analysis of dynamic interactions over post-sample period via impulse response functions and variance decomposition suggest that Pakistan does influence the pattern of Foreign Direct Investment (FDI) inflow in India.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: Scholars Journal of Economics, Business and Management
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
