CAUSAL NEXUS BETWEEN FDI, EXPORTS, UNEMPLOYMENT AND ECONOMIC GROWTH FOR THE OLD EUROPEAN UNION MEMBERS. EVIDENCE FROM PANEL DATA

NIKOLAOS DRITSAKIS, PAVLOS STAMATIOU

Abstract:

This study examines the causality relationships between foreign direct investments (FDI), exports, unemployment and economic growth in the fifteen old EU members using panel data covering the period 1970-2015. The Hausman test is applied for choosing between Fixed Effect and Random Effect approach in order to estimate the panel VAR equations for Granger causality tests. The results revealed three bidirectional causalities between economic growth and exports, exports and FDI, and exports and unemployment and three unidirectional causalities running from FDI to economic growth, FDI to unemployment and from economic growth to unemployment. Policy implications are then explored in the conclusions.

Keywords:
Economic growth; Foreign direct investments; Exports; Unemployment; Panel analysis; Causality

DOI: 10.52950/ES.2018.7.2.002

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APA citation:
NIKOLAOS DRITSAKIS, PAVLOS STAMATIOU (2018). Causal Nexus between FDI, Exports, Unemployment and Economic Growth for the Old European Union Members. Evidence from Panel Data. International Journal of Economic Sciences, Vol. VII(2), pp. 35-56. , DOI: 10.52950/ES.2018.7.2.002


Copyright © 2018, Nikolaos Dritsakis et al, drits@uom.gr