International journal of

ADVANCED AND APPLIED SCIENCES

EISSN: 2313-3724, Print ISSN:2313-626X

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 Volume 6, Issue 1 (January 2019), Pages: 73-80

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 Original Research Paper

 Title: Does foreign direct investment spur economic growth in an oil-based country? Evidence from Saudi Arabia

 Author(s): Hichem Dkhili *

 Affiliation(s):

 College of Business Administration (CBA), Northern Border University, Arar, Saudi Arabia

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 * Corresponding Author. 

  Corresponding author's ORCID profile: https://orcid.org/0000-0001-5773-1494

 Digital Object Identifier: 

 https://doi.org/10.21833/ijaas.2019.01.010

 Abstract:

This paper investigates the relationship between foreign direct investment (FDI), and economic growth (GDPPC) in an oil-based economy during the period 1970-2016. In our econometric model, we introduce a proxy of country infrastructure (INFRA) which is the air transport to explain economic growth. The econometric method is based on vector error correction model (VECM), and Granger Causality. The long-run association reveals that FDI exerts a positive and significant effect on the economic growth in Saudi Arabia. Also, the Granger Causality test shows that there is unidirectional causality between FDI and growth. Findings indicate also that trade openness (OPEN) did not Granger cause GDPPC. In contrary, there is unidirectional causality between INFRA and GDPPPC. 

 © 2018 The Authors. Published by IASE.

 This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/).

 Keywords: FDI, Economic growth, Saudi Arabia, Granger causality

 Article History: Received 16 October 2017, Received in revised form 21 November 2018, Accepted 22 November 2018

 Acknowledgement:

No Acknowledgement

 Compliance with ethical standards

 Conflict of interest:  The authors declare that they have no conflict of interest.

 Citation:

 Dkhili H (2019). Does foreign direct investment spur economic growth in an oil-based country? Evidence from Saudi Arabia. International Journal of Advanced and Applied Sciences, 6(1): 73-80

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 Figures

 Fig. 1 Fig. 2 Fig. 3 

 Tables

 Table 1 Table 2 Table 3 Table 4 Table 5 Table 6

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