Title: Nexus among foreign direct investment, domestic investment, financial development and economic growth: a NARDL approach in Pakistan

Authors: Hafiz M. Sohail; Zengfu Li

Addresses: School of Economics and Management, South China Normal University, Guangzhou 510631, China ' School of Economics and Management, South China Normal University, Guangzhou 510631, China

Abstract: One of the most recent issues has been the relationship between foreign direct investment and economic development in host economies. This paper examines the nonlinear relationship between economic growth, foreign direct investment, domestic investment, and financial development using annual time series data from 1970 to 2019. We used the nonlinear auto-regressive distribution lag (NARDL) co-integration technique. The results show the positive effects of FDI and DI are more significant than the negative effects and follow a nonlinear direction. As a result, policymakers should tighten their hold on FDI channelling and effectively enforce regulations in order to boost Pakistan's economic development.

Keywords: economic growth; foreign direct investment; domestic investment; nonlinear ARDL; Pakistan.

DOI: 10.1504/IJEBR.2023.127931

International Journal of Economics and Business Research, 2023 Vol.25 No.2, pp.249 - 269

Received: 25 Feb 2021
Accepted: 22 Apr 2021
Published online: 22 Dec 2022 *

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