Foreign Direct Investment, Trade Openness and Economic Growth in Ghana: An Empirical Investigation

Daniel Sakyi; Richmond Commodore; Eric Evans Osei Opoku

doi:10.1080/15228916.2015.1061283

Foreign Direct Investment, Trade Openness and Economic Growth in Ghana: An Empirical Investigation

Daniel Sakyi, Richmond Commodore, Eric Evans Osei Opoku

Research output: Journal Publication › Article › peer-review

54 Citations (Scopus)

Abstract

Abstract: This paper investigates the long-run impact of foreign direct investment and trade openness on economic growth in Ghana (1970–2011) within the framework of the endogenous growth literature. Adopting the autoregressive distributed lag bounds testing approach to cointegration the results suggest that the interaction of foreign direct investment and exports has been crucial in fostering growth, thus validating the famous Bhagwati hypothesis. From a policy oriented point of view, the study recommends the channeling of foreign direct investment to export-oriented sectors and the promotion of export-led growth strategies in long-term development plans.

Original language	English
Pages (from-to)	1-15
Number of pages	15
Journal	Journal of African Business
Volume	16
Issue number	1-2
DOIs	https://doi.org/10.1080/15228916.2015.1061283
Publication status	Published - 4 May 2015
Externally published	Yes

Keywords

Cointegration
FDI
Ghana
economic growth
trade openness

ASJC Scopus subject areas

Geography, Planning and Development
Development

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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10.1080/15228916.2015.1061283

Cite this

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title = "Foreign Direct Investment, Trade Openness and Economic Growth in Ghana: An Empirical Investigation",

abstract = "Abstract: This paper investigates the long-run impact of foreign direct investment and trade openness on economic growth in Ghana (1970–2011) within the framework of the endogenous growth literature. Adopting the autoregressive distributed lag bounds testing approach to cointegration the results suggest that the interaction of foreign direct investment and exports has been crucial in fostering growth, thus validating the famous Bhagwati hypothesis. From a policy oriented point of view, the study recommends the channeling of foreign direct investment to export-oriented sectors and the promotion of export-led growth strategies in long-term development plans.",

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T2 - An Empirical Investigation

AU - Sakyi, Daniel

AU - Commodore, Richmond

AU - Opoku, Eric Evans Osei

PY - 2015/5/4

Y1 - 2015/5/4

N2 - Abstract: This paper investigates the long-run impact of foreign direct investment and trade openness on economic growth in Ghana (1970–2011) within the framework of the endogenous growth literature. Adopting the autoregressive distributed lag bounds testing approach to cointegration the results suggest that the interaction of foreign direct investment and exports has been crucial in fostering growth, thus validating the famous Bhagwati hypothesis. From a policy oriented point of view, the study recommends the channeling of foreign direct investment to export-oriented sectors and the promotion of export-led growth strategies in long-term development plans.

AB - Abstract: This paper investigates the long-run impact of foreign direct investment and trade openness on economic growth in Ghana (1970–2011) within the framework of the endogenous growth literature. Adopting the autoregressive distributed lag bounds testing approach to cointegration the results suggest that the interaction of foreign direct investment and exports has been crucial in fostering growth, thus validating the famous Bhagwati hypothesis. From a policy oriented point of view, the study recommends the channeling of foreign direct investment to export-oriented sectors and the promotion of export-led growth strategies in long-term development plans.

KW - Cointegration

KW - FDI

KW - Ghana

KW - economic growth

KW - trade openness

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SN - 1522-8916

VL - 16

SP - 1

EP - 15

JO - Journal of African Business

JF - Journal of African Business

IS - 1-2

ER -

Foreign Direct Investment, Trade Openness and Economic Growth in Ghana: An Empirical Investigation

Abstract

Keywords

ASJC Scopus subject areas

UN SDGs

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