Causality between foreign direct investment in the automotive sector and export performance of Macedonian economy

Research background: Foreign direct investment is perceived as a valuable tool for economic growth. The growth could be realized more or less as a set of benefits depending on the FDIs features. In the period from 2009 to 2016 a remarkable increase in the share of FDIs inflow in automotive sector in Macedonian economy was noticed, from 2.8% to 14.1%. Thus, there seem to be good reasons to examine the issue of how the increased FDI inflow expressed through the remarkable in-crease of FDIs inflow in the automotive sector. Purpose of the article: The aim of the paper is to analyze the causality between the increased FDIs inflow in the automotive industry and a remarkable export growth. The research interest of the study is to recognize the importance of the FDIs inflow structure as a determinant of the export structure. Methods: Within the paper a model is developed that identifies the FDIs as a factor of growth of the export performances. A regression analysis is used to examine the correlation between the FDIs inflow and export. In order to examine causality, the Granger causality test is applied between the FDIs inflow and increased export. Findings & Value added: The results suggest that FDIs create a good basis for quantitative and qualitative shift in the export structure of the Macedonian economy. The paper associates growth of sectoral export with the growth of FDIs in that sector. Due to the increased FDI inflow in the automotive industry, this sector has significantly increased its share in the total Macedonian export. The paper indicates that FDIs can be considered as a way of engagement in the global supplying chains, which additionally influences positively the competitiveness and export performance of the host suppliers.

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PID https://www.doi.org/10.24136/eq.2018.021
URL https://doaj.org/toc/1689-765X
URL http://yadda.icm.edu.pl/yadda/element/bwmeta1.element.ekon-element-000171529498
URL http://dx.doi.org/10.24136/eq.2018.021
URL https://doaj.org/toc/2353-3293
URL http://economic-research.pl/Journals/index.php/eq/article/view/1059
URL http://economic-research.pl/Journals/index.php/eq/article/download/1059/1013
URL https://econpapers.repec.org/RePEc:pes:ierequ:v:13:y:2018:i:3:p:427-443
URL https://academic.microsoft.com/#/detail/2895724298
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Access Right Open Access
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Author Jovanka Damoska Sekuloska
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Collected From UnpayWall; DOAJ-Articles; Crossref; Microsoft Academic Graph
Hosted By Equilibrium. Quarterly Journal of Economics and Economic Policy
Journal Equilibrium. Quarterly Journal of Economics and Economic Policy, ,
Publication Date 2018-09-01
Publisher Institute of Economic Research
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Language English
Resource Type Article
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Source https://science-innovation-policy.openaire.eu/search/publication?articleId=dedup_wf_001::5a0f452b23e93dfcdb305fe55c41e0f5
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Last Updated 26 December 2020, 14:21 (CET)
Created 26 December 2020, 14:21 (CET)