Abstract
In this paper we investigate the causal relationship between foreign direct investment, trade openness and gross domestic product in BRICS countries over the period of 1990–2018. We applied auto regressive distributed lag model to test cointegration and the Dumitrescu and Hurlin Granger causality tests. Empirical results show that FDI and trade openness have a positive impact on long-term economic growth. We also find there is a long-run relationship from both real effective exchange rate and gross capital formation to economic growth. The main results of causality analysis reveal that there is bidirectional causality from foreign direct investment to economic growth, trade openness to foreign direct investment, and unidirectional causality from trade openness to foreign direct investment.
Sign-in/Register to access full text options 
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 callDisclaimer: 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.
