Determinants of Economic Growth: A Comparative Analysis of Asian Countries

Abstract

This paper investigated how Official Development Assistance (ODA), Foreign Direct Investment (FDI), export, population and raw materials prices affect economic growth in 21 Asian countries. These 21 Asian countries are categorized in to low and middle income based on a Gross National Income (GNI) of USD 3,000 as benchmark. The grouping was used in the Panel Comparative Analysis. Empirical results showed that ODA has more influence on economic growth among the middle-income Asian countries. However, it has little impact on the economic growth of low-income Asian countries. On the other hand, FDI brought positive impact on the economic growth of middle-income Asian countries. However, it did not have an impact on the economic growth of low-income countries. Export brought about more influence on the economic growth of the 21 Asian countries. On the contrary, the population has no impact on economic growth. Raw material prices have positive impact on the economic growth of both the low and middle-income Asian countries. To promote the speedy economic growth in Asia, developed countries should consider the political transparency among developing countries whenever ODA contribution is being made. The developing countries will give a variety of benefits to foreign investor through greenfield investment rather compared to brown-filed one.