Download full text
(external source)
Citation Suggestion
Please use the following Persistent Identifier (PID) to cite this document:
https://doi.org/10.32609/j.ruje.5.38073
Exports for your reference manager
The impact of currency crises on economic growth and foreign direct investment: The analysis of emerging and developing economies
[journal article]
Abstract In this paper, the discussion centers on the possible effects of currency crises on different economic indicators, with special attention to economic growth and foreign direct investment. There is insufficient research on this topic to draw any firm conclusions about the associations between currenc... view more
In this paper, the discussion centers on the possible effects of currency crises on different economic indicators, with special attention to economic growth and foreign direct investment. There is insufficient research on this topic to draw any firm conclusions about the associations between currency crises and aforementioned variables. In fact, it appears that the impact of currency crises on economic growth and foreign direct investment is negative respectively. However, this study indicates that foreign direct investment can be positively correlated with currency crises as contrary to the common belief. The current study analyzes these relationships through dynamic panel models. The annual panel data for 71 emerging and developing countries are extracted from reliable databases for the time period of 2005-2014. Generalized method of moments estimators are used to obtain efficient and consistent results so as to reach necessary conclusions. The majority of estimated coefficients are significant and unbiased statistically, and also consistent with the economic theories proposed. The main results indicate that the presence of a currency crisis in a particular economy has a negative impact on economic growth, while its effect on foreign investment inflows is most likely positive. Robustness tests demonstrate that used models in the study are both economically and econometrically robust and valid.... view less
Keywords
economic growth; direct investment; foreign investment; newly industrializing countries; developing country; financial crisis
Classification
Political Economy
Free Keywords
currency crises; exchange market pressure index; generalized method of moments
Document language
English
Publication Year
2019
Page/Pages
p. 220-250
Journal
Russian Journal of Economics, 5 (2019) 3
ISSN
2618-7213
Status
Published Version; reviewed
Licence
Creative Commons - Attribution-Noncommercial-No Derivative Works 4.0