Page 6 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE, V.81, # 1, 2024, pp. 4-21

As for the different studies by researchers based on using comprehensive data for
several countries. A study by (Hlavacek & Bal-Domanska, 2016) examined the impact
of FDI on economic development in Central and Eastern European countries during
the period 200-2012.

It concluded that FDI plays a unique role in the economic transformation because it
contributes to the economic development of Central and Eastern European countries
and becomes a tool for integrating economies undergoing transition into global
production chains.
In a study conducted by (Khawar, 2005) FDI and economic development: A
comprehensive analysis of several countries covering the period 1970-1992. The
results, regardless of any requirements for human capital, found that FDI has a
significant and positive link with per capita real income. In addition, the coefficient
of the FDI variable was much larger than the coefficient of the domestic investment
variable, reflecting the significant potential for the positive impact contributed by FDI.

On the other hand, there is a negative context that may be present in the link between
FDI and economic development using data for several countries, and a study by
(Herzer, 2012) covered 44 developing countries during the period 1970-2005, found
that FDI has a negative effect on development in developing countries.

Similarly, a study by (Velonjara & Gondje-Dacka, 2019) found that the effect of FDI
on economic development is negative and statistically significant for 9 countries in
West Africa, during the period 2000-2016 .

In the short and long term, a study by (Ayenew, 2022) confirmed that the impact of
FDI on economic development is significant and positive in the long term, and
statistically insignificant in the short term, in 22 Sub-Saharan African countries.

A study by (Mohamed, Liu, & Nie, 2021) focused on finding the link between
technological innovation, FDI, and economic development in Egypt during the period
1990-2019, found a statistically significant positive link between the share of total
capital formation and FDI in economic development in the long term, and the
innovation index and inflation rate had a negative impact in the long term, with a very
high speed of adjustment towards equilibrium. A study by (Huong, Duong, & Thuy,
2018) researched the effects of human resources and FDIs on economic development
in Vietnam, showing that unemployment rates have a negative impact on economic
development in the long and short term.

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