Onwuka, Kevin O., and Chaiechi, Taha (2013) Foreign direct investment, financial markets and growth dynamics in MENA oil producing countries: a panel investigation. Journal of Finance and Investment Analysis, 2 (2). pp. 135-159.

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Abstract

The objective of this paper is to examine whether foreign direct investments (FDI) in extractive sector enhances growth, using data from seven MENA oil producing countries; namely Bahrain, Kuwait, Oman, Qatar, United Arab Emirates, Saudi Arabia and Iran over the period 1980 to 2004. We employ fixed effects estimation technique to estimate the coefficients of our models. The main findings are: First, the effect of FDI is very small, and it can have positive spillovers in the host countries if there are adequate absorptive capacities – well developed financial markets and human capital. Second, the financial markets are inadequate to spur growth and enhance the role of FDI in the growth process in MENA oil producing countries. The paper opines that policy focus should be towards improving the absorptive capacities, as growth should evolve internally, not externally.

Item ID:	28672
Item Type:	Article (Scholarly Work)
ISSN:	2241-0996
Keywords:	foreign direct investment, extractive sector, financial markets, growth and MENA region
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Date Deposited:	20 Aug 2013 02:49
FoR Codes:	14 ECONOMICS > 1402 Applied Economics > 140212 Macroeconomics (incl Monetary and Fiscal Theory) @ 50% 14 ECONOMICS > 1402 Applied Economics > 140202 Economic Development and Growth @ 50%
SEO Codes:	91 ECONOMIC FRAMEWORK > 9101 Macroeconomics > 910103 Economic Growth @ 50% 91 ECONOMIC FRAMEWORK > 9101 Macroeconomics > 910109 Savings and Investments @ 50%
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