IDEAS home Printed from https://ideas.repec.org/a/bpj/glecon/v18y2018i4p16n2.html
   My bibliography  Save this article

Effects of Economic Globalization, Foreign Capital Influx on Export in ECOWAS

Author

Listed:
  • Amadou Maiga Ousseini

    (College of economics and trade, Hunan University, Changsha, China)

  • Hu Xiaojuan

    (College of economics and trade, Hunan University, Changsha, China)

  • Metuge Mekongcho Terence

    (College of economics and trade, Hunan University, Changsha, China)

  • Kigbadjah Coulibaly Salifou

    (College of economics and trade, Hunan University, Changsha, China)

Abstract

The relationships between globalization, foreign direct investment (FDI), and exports (trade) have been the subject of in-depth studies leading to mixed and inconclusive results. This study investigates how globalization and FDI influence and affect export, as well as the responsiveness of exports to globalization shocks in the West African ECOWAS region over the period 1980–2014. To investigate these phenomena, the study uses Panel VAR, cointegration methods and long-run estimation methods to estimate the short-run, cointegration and long-run relationships, as well as the responsiveness of export shocks due to economic globalization and FDI. The Panel VAR and Granger causality test results showed that there is a positive and significant effect as well as a causal relationship between economic globalization, non-export GDP, and short-term exports. Further, the study also shows that there is no significant effect and no causal relationship between FDI and exports in the short-run, but, FDI has a positive and significant relationship with export in the long-run in the ECOWAS region. The cointegration and long-run analysis showed the existence of cointegration and a long-run relationship between exports and the regressors included in this study.

Suggested Citation

  • Amadou Maiga Ousseini & Hu Xiaojuan & Metuge Mekongcho Terence & Kigbadjah Coulibaly Salifou, 2018. "Effects of Economic Globalization, Foreign Capital Influx on Export in ECOWAS," Global Economy Journal, De Gruyter, vol. 18(4), pages 1-16, December.
    • Handle: RePEc:bpj:glecon:v:18:y:2018:i:4:p:16:n:2
    DOI: 10.1515/gej-2018-0055
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/gej-2018-0055
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.
    File URL: https://libkey.io/10.1515/gej-2018-0055?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Zhang, Qing & Felmingham, Bruce, 2001. "The relationship between inward direct foreign investment and China's provincial export trade," China Economic Review, Elsevier, vol. 12(1), pages 82-99.
    2. Richard Kneller & Mauro Pisu, 2007. "Industrial Linkages and Export Spillovers from FDI," The World Economy, Wiley Blackwell, vol. 30(1), pages 105-134, January.
    3. Pedroni, Peter, 2004. "Panel Cointegration: Asymptotic And Finite Sample Properties Of Pooled Time Series Tests With An Application To The Ppp Hypothesis," Econometric Theory, Cambridge University Press, vol. 20(3), pages 597-625, June.
    4. Albert G. Z. Hu & Gary H. Jefferson, 2002. "FDI Impact and Spillover: Evidence from China's Electronic and Textile Industries," The World Economy, Wiley Blackwell, vol. 25(8), pages 1063-1076, August.
    5. Laura Alfaro & Sebnem Kalemli‐Ozcan & Selin Sayek, 2009. "FDI, Productivity and Financial Development," The World Economy, Wiley Blackwell, vol. 32(1), pages 111-135, January.
    6. Chihwa Kao & Min-Hsien Chiang, 1997. "On the Estimation and Inference of a Cointegrated Regression in Panel Data," Econometrics 9703001, University Library of Munich, Germany.
    7. Céline Carrère, 2004. "African Regional Agreements: Impact on Trade with or without Currency Unions," Journal of African Economies, Centre for the Study of African Economies, vol. 13(2), pages 199-239, June.
    8. Muhammad Azam & Phouphet Kyophilavong & Muhammad Shahbaz & Qaisar Abbas, 2016. "External sources and economic growth-the role of foreign remittances: Evidence from Europe and Central Asia," Journal of Developing Areas, Tennessee State University, College of Business, vol. 50(2), pages 367-387, April-Jun.
    9. Michael R. M. Abrigo & Inessa Love, 2016. "Estimation of panel vector autoregression in Stata," Stata Journal, StataCorp LP, vol. 16(3), pages 778-804, September.
    10. Peter Pedroni, 2000. "Fully Modified OLS for Heterogeneous Cointegrated Panels," Department of Economics Working Papers 2000-03, Department of Economics, Williams College.
    11. Jamshid Damooei. & Tavakoli, Akbar., 2006. "The Effects of Foreign Direct Investment And Imports on Economic Growth: A Comparative Analysis of Thailand and the Philippines (1970-1998)," Journal of Developing Areas, Tennessee State University, College of Business, vol. 39(2), pages 79-100, January-M.
    12. O. Morrissey & I. Filatotchev, 2000. "Globalisation and Trade: The Implications for Exports from Marginalised Economies," Journal of Development Studies, Taylor & Francis Journals, vol. 37(2), pages 1-12.
    13. Onaran, Özlem & Stockhammer, Engelbert, 2006. "The effect of FDI and foreign trade on wages in the Central and Eastern European Countries in the post-transition era: A sectoral analysis," Department of Economics Working Paper Series 94, WU Vienna University of Economics and Business.
    14. Rashmi Banga, 2006. "The export-diversifying impact of Japanese and US foreign direct investments in the Indian manufacturing sector," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 37(4), pages 558-568, July.
    15. Peter Pedroni, 1999. "Critical Values for Cointegration Tests in Heterogeneous Panels with Multiple Regressors," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(S1), pages 653-670, November.
    16. Fukunari Kimura & Kozo Kiyota, 2006. "Exports, FDI, and Productivity: Dynamic Evidence from Japanese Firms," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 142(4), pages 695-719, December.
    17. Peter C. B. Phillips & Hyungsik R. Moon, 1999. "Linear Regression Limit Theory for Nonstationary Panel Data," Econometrica, Econometric Society, vol. 67(5), pages 1057-1112, September.
    18. Michael R.M. Abrigo & Inessa Love, 2016. "Estimation of Panel Vector Autoregression in Stata: a Package of Programs," Working Papers 201602, University of Hawaii at Manoa, Department of Economics.
    19. Sourafel Girma & Richard Kneller & Mauro Pisu, 2005. "Exports versus FDI: An Empirical Test," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 141(2), pages 193-218, July.
    20. Demekas, Dimitri G. & Horvath, Balazs & Ribakova, Elina & Wu, Yi, 2007. "Foreign direct investment in European transition economies--The role of policies," Journal of Comparative Economics, Elsevier, vol. 35(2), pages 369-386, June.
    21. GIURGIU Adriana & DODESCU Anca, 2009. "Globalisation And Export Competitiveness: A Theoretical Approach," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 318-324, May.
    22. Nelson C. Mark & Donggyu Sul, 2003. "Cointegration Vector Estimation by Panel DOLS and Long‐run Money Demand," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 65(5), pages 655-680, December.
    23. Shiva S. Makki & Agapi Somwaru, 2004. "Impact of Foreign Direct Investment and Trade on Economic Growth: Evidence from Developing Countries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(3), pages 795-801.
    24. Peter Pedroni, 2001. "Purchasing Power Parity Tests In Cointegrated Panels," The Review of Economics and Statistics, MIT Press, vol. 83(4), pages 727-731, November.
    25. Johansen, Soren, 1988. "Statistical analysis of cointegration vectors," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 231-254.
    26. repec:bla:obuest:v:61:y:1999:i:0:p:653-70 is not listed on IDEAS
    27. Albert Wijeweera & Renato Villano & Brian Dollery, 2010. "Economic growth and FDI inflows:a stochastic frontier analysis," Journal of Developing Areas, Tennessee State University, College of Business, vol. 43(2), pages 143-158, January-M.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Malayaranjan Sahoo & Narayan Sethi, 2023. "An Empirical Insight into the Financial Globalization–Growth Nexus via Trade Openness: Evidence from Select South Asian Countries," Global Business Review, International Management Institute, vol. 24(2), pages 317-334, April.
    2. Radovan Kastratović, 2020. "The impact of foreign direct investment on host country exports: A meta‐analysis," The World Economy, Wiley Blackwell, vol. 43(12), pages 3142-3183, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. João Valle e Azevedo & João Ritto & Pedro Teles, 2022. "The Neutrality Of Nominal Rates: How Long Is The Long Run?," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 63(4), pages 1745-1777, November.
    2. Liu, Jingyang & Kool, Clemens J.M., 2018. "Money and credit overhang in the euro area," Economic Modelling, Elsevier, vol. 68(C), pages 622-633.
    3. Dierk Herzer & Julian Donaubauer, 2018. "The long-run effect of foreign direct investment on total factor productivity in developing countries: a panel cointegration analysis," Empirical Economics, Springer, vol. 54(2), pages 309-342, March.
    4. Behera, Smruti Ranjan Behera & Dua, Pami Dua & Goldar, Bishwanath Goldar, 2012. "Horizontal and Vertical Technology Spillover of Foreign Direct Investment: An Evaluation across Indian Manufacturing Industries," MPRA Paper 43293, University Library of Munich, Germany.
    5. Alessandro Bellocchi & Edgar J. Sanchez Carrera & Giuseppe Travaglini, 2021. "What drives TFP long-run dynamics in five large European economies?," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 38(2), pages 569-595, July.
    6. Nagmi Moftah Aimer, 2020. "Renewable energy consumption, financial development and economic growth: Evidence from panel data for the Middle East and North African countries," Economics Bulletin, AccessEcon, vol. 40(3), pages 2058-2072.
    7. Muhammad Zakaria & Bashir Ahmed Fida & Saquib Yousaf Janjua & Syed Jawad Hussain Shahzad, 2017. "Fertility and Financial Development in South Asia," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 133(2), pages 645-668, September.
    8. Herzer, Dierk & Nunnenkamp, Peter, 2015. "Income inequality and health: Evidence from developed and developing countries," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 9, pages 1-56.
    9. Coulibaly, Issiaka & Gnimassoun, Blaise, 2013. "Optimality of a monetary union: New evidence from exchange rate misalignments in West Africa," Economic Modelling, Elsevier, vol. 32(C), pages 463-482.
    10. Acikgoz, Senay & Ben Ali, Mohamed Sami, 2019. "Where does economic growth in the Middle Eastern and North African countries come from?," The Quarterly Review of Economics and Finance, Elsevier, vol. 73(C), pages 172-183.
    11. Pedro Teles & Harald Uhlig & João Valle e Azevedo, 2016. "Is Quantity Theory Still Alive?," Economic Journal, Royal Economic Society, vol. 126(591), pages 442-464, March.
    12. Juan Carlos Aquino & N. R. Ramírez-Rondán, 2020. "Estimating factor shares from nonstationary panel data," Empirical Economics, Springer, vol. 58(5), pages 2353-2380, May.
    13. In Choi, 2012. "Panel Cointegration," Working Papers 1208, Nam Duck-Woo Economic Research Institute, Sogang University (Former Research Institute for Market Economy).
    14. Emrah KOÇAK & Nısfet UZAY, 2018. "Democracy, Economic Freedoms and Economic Growth: An Investigation on the Role of Institutions," Sosyoekonomi Journal, Sosyoekonomi Society, issue 26(36).
    15. Costantini, Valeria & Martini, Chiara, 2010. "The causality between energy consumption and economic growth: A multi-sectoral analysis using non-stationary cointegrated panel data," Energy Economics, Elsevier, vol. 32(3), pages 591-603, May.
    16. Dierk Herzer, 2010. "The Long-Run Relationship between Outward FDI and Total Factor Productivity: Evidence for Developing Countries," Ibero America Institute for Econ. Research (IAI) Discussion Papers 199, Ibero-America Institute for Economic Research.
    17. Martin Wagner & Jaroslava Hlouskova, 2010. "The Performance of Panel Cointegration Methods: Results from a Large Scale Simulation Study," Econometric Reviews, Taylor & Francis Journals, vol. 29(2), pages 182-223, April.
    18. Stojkoski, Viktor & Popova, Kristina, 2016. "Financial Development and Growth: Panel Cointegration Evidence from South-Eastern and Central Europe," MPRA Paper 69029, University Library of Munich, Germany.
    19. Nicole Grunewald & Inmaculada Martínez-Zarzoso, 2014. "Green Growth in Mexico, Brazil and Chile: Policy strategies and future prospects," Ibero America Institute for Econ. Research (IAI) Discussion Papers 229, Ibero-America Institute for Economic Research.
    20. Helmi Hamdi & Ali Said & Rashid Sbia, 2015. "Empirical Evidence on the Long-Run Money Demand Function in the Gulf Cooperation Council Countries," International Journal of Economics and Financial Issues, Econjournals, vol. 5(2), pages 603-612.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:glecon:v:18:y:2018:i:4:p:16:n:2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.