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Orkhan Dadashov: The Effect of Foreign Direct Investment on Azerbaijan’s Non-Oil GDP

In fact, it suggests that there is a less than 0.1% probability of obtaining such a strong
correlation due to random chance. Therefore, we can conclude that the correlation is
statistically significant.

Overall, this suggests that there is a strong positive relationship between the inflows
of foreign direct investment and the non-oil GDP of Azerbaijan. In other words, as
foreign direct investment increases, the non-oil GDP of Azerbaijan also tends to
increase.
Table 2: Pearson correlation

Source: The table was prepared by the author using SPSS

Regression Analysis:

For further investigation let's look at the Linear regression test between these variables.
Regression analysis is a statistical technique used to examine the relationship between a
dependent variable and one or more independent variables. Regression tests are necessary
to evaluate the statistical significance of the relationship between the variables and to
make predictions or estimates based on the model. Regression tests help to estimate the
impact or effect of independent variables on the dependent variable. By analyzing the
coefficients of the regression equation, we can determine how much the dependent
variable changes for a given change in the independent variable(s). Regression tests also
help us to make predictions or forecasts based on the relationship between the dependent
variable and the independent variable.

Table 3: Liner Regression test (SPSS)

Source: The table was prepared by the author using SPSS

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