Does macroeconomic stability sustain the impact of FDI on economic growth and emergence? An empirical analysis for countries from Africa, Latin America/the Caribbean, and Asia

This paper tests for the relationship between foreign direct investment (FDI) and economic growth among some developing countries distributed between three geographic areas, over the period 1990-2005. Our results are derived from the 3SLS estimator. Our main findings show that FDIs do positively affect economic growth in Africa and Latin America/the Caribbean. On the other hand, macroeconomic instability does exert a negative effect and limits the effect of FDI on economic growth in Africa. Adapted from the source document.