Does Household Consumption Mediate the Linkage between Foreign Direct Investment and Gross Domestic Product?

Evidence from Sub-Sahara African Countries 2016

Scientific Study , 2020 , 24 Pages , Grade: "-"

Sociology - Miscellaneous

This study contributes to the empirical literature by investigating the mediation effects of household consumption (HHC) in the linkages between inflows of foreign direct investment (FDI), and gross domestic product (GDP) for Sub-Sahara African Countries (SSA) for 2016. Correlation and robust mediation were used in the analysis. The result of the study shows a positive and statistically significant relation between FDI and HHC. At to the nature of the mediation effects of HHC in the relationship between GDP and FDI, the variance accounted for (VAF) is 94.4% of the total impact of FDI on GDP, indicating a full mediation. SSA should stimulate FDI to boost their economic growth.

The study is inspired by the hypothesis stated by Mamingi and Martin (2018) that the direct effect of FDI on GDP is small when FDI is considered in isolation, but indirect effect is more significant than direct effect. The paper contributes to the existing literature by conducting a quantitative research in contrast of the hypothesis of Moolio and Guech Heang (2013) indicating that indirect impacts of FDI on GDP are analyzed in qualitative approach, but not in quantitative approach.

Inhaltsverzeichnis (Table of Contents)

• Abstract
• 1. Introduction
• 2. Literature Review
  • 2.1. Theoretical Review...
  • 2.2. Empirical Review.
• 3. Methodology
• 4. Research Results
  • 4.1. Descriptive statistics
  • 4.3. Mediation Analysis.
• 5. Result Discussion and Conclusion
  • 5.1. Results Interpretation ......
  • 5.2. Conclusion.......
• References

Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)

This study examines the mediation effects of household consumption (HHC) in the relationship between foreign direct investment (FDI) and gross domestic product (GDP) in Sub-Sahara African countries for the year 2016. It aims to investigate the extent to which HHC acts as an intermediary in the impact of FDI on GDP, challenging the existing literature that primarily focuses on direct effects.

• The role of household consumption in the relationship between FDI and GDP
• The direct and indirect effects of FDI on economic growth
• The quantitative analysis of indirect effects of FDI
• The limitations of existing literature on the impact of FDI on GDP
• The complex and multifaceted nature of FDI's impact on economic development

Zusammenfassung der Kapitel (Chapter Summaries)

• Introduction: This chapter outlines the study's objective to investigate the mediation effects of household consumption in the relationship between FDI and GDP in Sub-Sahara African countries for the year 2016. It highlights the limitations of previous research that primarily focused on direct effects and emphasizes the significance of analyzing indirect effects.
• Literature Review: This chapter reviews the existing literature on the impact of FDI on GDP, examining both theoretical frameworks and empirical studies. It discusses the direct and indirect effects of FDI, highlighting the gaps in knowledge regarding the mechanisms through which FDI contributes to economic growth.
• Methodology: This chapter outlines the research methodology used in the study, including the data sources, variables, and statistical techniques employed to analyze the relationship between FDI, HHC, and GDP.
• Research Results: This chapter presents the findings of the study, including descriptive statistics and the results of the mediation analysis. It reveals the statistical significance of the relationships between FDI, HHC, and GDP, as well as the extent to which HHC mediates the impact of FDI on GDP.

Schlüsselwörter (Keywords)

This research focuses on foreign direct investment (FDI) inflows, household consumption (HHC), direct and indirect effects, gross domestic product (GDP), mediation analysis, and Sub-Sahara African countries. The study analyzes the relationship between these factors and explores the mediating role of HHC in the impact of FDI on GDP growth in the region.

• Grade: "-"
• Author: Antoine Niyungeko (Author)
• Publication Year: 2020
• Pages: 24
• Catalog Number: V902847
• ISBN (eBook): 9783346258014
• ISBN (Book): 9783346258021
• Language: English
• Tags: does, household, consumption, mediate, linkage, foreign, direct, investment, gross, domestic, product, evidence, sub-sahara, african, countries