Abstract
<p><em>ASEAN become one of the main destination location for Foreign Direct Investment (FDI) however its FDI growth showed a declining trend. On the other hand, gender equality of this region keep progressing over time and surpassed the global average gender equality index. This paper examined the effect of gender equality on the growth of foreign direct investment inflows using static panel model for eight ASEAN countries for 2010-2016 period. Our result showed that gender equality could boost the FDI inflow growth through the increase of labor force participation and tertiary education. Labor force participation able to enhance the effort of boosting FDI growth through the macroeconomic channel such as GDP growth, infrastructure, inflation, interest rate and exchange rate.</em></p>
Highlights
Investment holds an important key for social, economic and political development of a nation
One of the foreign capital form is foreign direct investment (FDI), which is an investment made to acquire a lasting interest to have an effective choice in the management of the enterprise in foreign country according to The United Nations Conference on Trade and Development (UNCTAD)
FDI considered to be the engine of economic growth, since modernization theory suggests that economic growth requires capital investment
Summary
Investment holds an important key for social, economic and political development of a nation. Especially developing countries such as ASEAN countries is unable to create sufficient investable fund from its domestic sources, foreign sources capital remains an important part for economic sustainability (Hossain and Chowdury 1998). One of the foreign capital form is foreign direct investment (FDI), which is an investment made to acquire a lasting interest to have an effective choice in the management of the enterprise in foreign country according to The United Nations Conference on Trade and Development (UNCTAD). The new growth theory highlights that it is the knowledge transfer through FDI to the developing countries that are scarce in the necessary infrastructure and education. Multinational corporations’ investment in the host country imposes the pressure on the local firms to develop new technologies and innovate. The importance of FDI on economic growth confirmed by Yaseen (2014) in the study of FDI in Jordan, Najib et al (2013) of Pakistan’s FDI and Melnyk et al (2014)
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