Doğrudan Yabancı Yatırım Çıkışları ile Ekonomik Kırılganlık Arasında Nedensellik: Sekiz Kırılgan Ekonomi Üzerine İnceleme
Causality between Foreign Direct Investment Outflows and Economic Fragility: A Study on Eight Fragile Economies

Summary/Abstract: The aim of this study is to investigate the causality relationship between FDI outflows and economic fragility indicators in eight fragile economies (Argentina, Brazil, China, Colombia, India, South Africa, Thailand, Turkey). The data set of the study, which covers the period 1995-2021, consists of FDI outflows and economic fragility indicators; consumer price index, central government debt/GDP, total reserves/foreign debt, M2/GDP, current account balance/GDP, domestic private sector loans provided by banks/GDP and total debt/exports. According to the results of the bootstrap panel causality analysis developed by Kónya (2006), the causality relationship between the variables representing economic fragility and FDI outflows is highest in Thailand and lowest in China. The results show that there is no strong consensus on the direction of the causal relationship between economic fragility indicators and FDI outflows. Based on the findings of the study, it is recommended that each country should develop policies in line with its own internal dynamics.

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