(Luận văn) foreign direct investment, financial development and economic growth in asian developing countries

INSTUTION OF SOCIAL STUDIES UNIVERSITY OF ECONOMICS t to HO CHI MINH CITY THE HAGUE ng VIETNAM THE NETHERLANDS hi ep w n lo ad VIETNAM- NETHERLANDS th PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS u yj p yi la an lu n va FOREIGN DIRECT INVESTMENT, FINANCIAL fu oi m ll DEVELOPMENT AND ECONOMIC GROWTH at nh IN ASIAN DEVELOPING COUNTRIES z z vb A thesis submitted in partial fulfilment of the requirements for the degree of k jm ht MASTER OF ARTS IN DEVELOPMENT ECONOMICS l.c om NGUYEN THUC DUY ANH gm By a Lu Academic Supervisor: DR NGUYEN VAN PHUC HO CHI MINH CITY, DECEMBER 2011 t to CERTIFICATION ng ep hi I hereby certify that the substance of the thesis has not already been submitted for w n lo any degree and is not being currently submitted for any other degree ad th I also certify that, to the best of my knowledge, and help received in preparing the yj ip uy thesis and all sources used have been acknowledged in the thesis a lu la n Signature n va oi m ll fu at nh z Nguyen Thuc Duy Anh z vb jm ht Date: k m co l gm an Lu n va r ACKNOWLEDGMENTS tn to ie gh p I would like to express my gratitude to all those who gave me the possibility to w complete this thesis n lo ad I am deeply grateful to my supervisor Dr Nguyen Van Phuc from Ho Chi Minh th yj City Open University whose support, stimulating suggestions and encouragement i uy • helped me in all the time of research for and writing of this thesis pl n ua al I am also very grateful to all lecturers of the Vietnam-Netherlands Programme for giving me knowledge and guidance to fulfill the M.A Programme n va m ll fu I would like to thank all the members of the Vietnam-Netherlands Program, especially, VNP Library for helping me to have necessary documents and research oi z at nh papers during my completion of the thesis Finally, I am indebted to my parents and my dear husband whose love, sympathy z k jm classmates for their warm encouragement ht vb and encouragement enabled me to complete this thesis I am also thankful to my om l.c gm Lu an n va r ; 11 ACRONYMS AND ABBREVIATIONS tn to • ie gh p Foreign Direct Investment FDI w Financial Development n FINANCE lo ad WDI Worldwide Governance Indicators yj i uy UNCTAD th WGI World Development Indicators United Nations Conference on Trade and Development pl Organization for Economic Cooperation and n ua al OECD Development n va Multinational Enterprises M&A Mergers and Acquisitions R&D Research and Development POOLED Pooled Regression Model FEM Fixed Effects Regression Model REM Random Effects Regression Model OLS Ordinary Least Square oi m ll fu • MNCs z at nh z ht vb k jm om l.c gm an Lu n va r • 111 ABSTRACT t to ng ep hi This research investigates the role of domestic financial development plays in w n enhancing FDI's positive effects on economic growth in Asian developing lo ad countries In other words, we examine whether countries with better domestic th financial system can utilize FDI more efficiently The empirical analysis uses yj uy balanced panel data of24 Asian developing countries in the period 1995-2009 This ip research applies the various models and techniques in panel data regression Linear la a lu static models for panel data named constant coefficients model or pooled regression n model (POOLED), fixed effects regression model (FEM) and random effects va n regression model (REM) are employed We analyze all models and employ many fu m ll kinds of test including poolability test, Hausman test, LM test, fixed effects tests n oi and Wald tests to select the most appropriated estimated model The research findings show that FDI alone does not have directly effect on economic growth but tz does have when combined with financial development Well-developed domestic z financial markets promote the process of technological diffusion associated with vb jm ht FDI in Asian developing countries Therefore, FDI and domestic financial development are complementary in increasing the rate of economic growth in the k om l.c FDI starts to have positive impacts on economic growth gm region There is a threshold level of domestic financial development above which an Lu n va r • lV t to I TABLE OF CONTENTS - ng CHAPTER INTRODUCTION ep hi 1.1 Problem statement w 1.2 Research objectives n lo 1.3 Research questions ad th 1.4 Research scope and data yj ip uy 1.5 Organization ofthe thesis a lu la CHAPTER LITERATURE REVIEW n 2.1 The impact ofFDI on economic growth va n 2.2 FDI, financial development and economic growth: theoretical framework and fu empirical studies 10 m ll • oi 2.2.1 Theoretical framework 10 nh at 2.2.1.1 Neoclassical growth model 10 z z 2.2.1.2 Endogenous growth model 11 j ht vb 2.2.1.3 Technological change model 11 k m 2.2.2 Empirical studies about the role of financial development in FDI- gm l.c Growth nexus 15 om 2.3 The measures of financial development 21 an Lu 2.4 The determinants of economic growth 23 • 3.1 Variables measurements 27 3.1.1 Dependent variable: Economic growth (GROWTH) 27 v r CHAPTER RESEARCH METHODOLOGY 27 n va Chapter remark (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries - - (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries 1.2 Independent variables 27 t to 3.1.3 Control variables (CONTROLS) 31 ng ep hi 3.2 Data collection 33 3.3 The estimation strategy 34 w n 3.3 Panel regression models lo ad 3.3.1.1 Constant coefficients model (POOLED) 35 th yj 3.3 1.2 Fixed effects regression model (FEM) uy ip 3.3.1.3 Random effects regression model (REM) 37 la n a lu 3.3.2 Choice of panel regression model (Testing panel models) 38 n va 3.3.2.1 The F-Test for individual and time effects in FEM models: 38 m ll fu 3.3.2.2 The Chow Test for the POOLED against the FEM (Test for poolability): 39 oi at nh 3.3.2.3 The Hausman Specification Test for the FEM against the REM 39 z 3.3.2.4 The Breusch-Pagan (1980)- Lagrange Multiplier (LM) Test for z jm ht vb the POOLED against the REM 40 3.3.3 Testing assumptions of the error term 41 k l gm 3.3.4 Model specification 41 3.4 Summary of the analytical methods 43 co m 3.5 Hypothesis statements 43 Lu an CHAPTER RESEARCH RESULTS 45 va 4.1 The descriptive statistics of the sample 45 n r 4.2 Empirical results 46 4.2.1 Examining the impact ofFDI, on its own, on economic growth 46 4.2.1.1 Choosing the appropriate model 47 Vl (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries 4.2.1.2 Test for heteroskedasticity 48 t to 4.2.1.3 Results discussion 50 ng ep hi 4.2.2 Examining the role of financial development in FDI-Growth nexus 51 4.2.2.1 Choosing the appropriate model 52 w n 4.2.2.2 Test for heteroskedasticity 53 lo ad 4.2.2.3 Results discussion 55 th yj 4.3 Chapter remark 62 uy ip CHAPTER CONCLUSION AND RECOMMENDATION 64 la n a lu 5.1 Conclusion 64 n va 5.2 Recommendation 66 m ll fu 5.3 Research limitation and suggestion for further study 68 REFERENCES 70 oi nh APPENDIX A LIST OF ASIAN DEVELOPING COUNTRIES A-1 at z APPENDIX B DATA SOURCES AND DESCRIPTIVE STATISTICS B-2 z vb jm ht APPENDIX C PANEL MODEL TESTS C-1 APPENDIX D REGRESSION MODEL RESULTS D-11 k m co l gm an Lu n va r Vll (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries Test for timeftxed effects: t to ng Figure C-16: Test for time fixed effects in the FEM modella -using LL Y ep hi ( ( ( ( w 1) 2) 3) 4) n ( 5) lo ( 6) ( 7) Iyear_1996 Jyear_l997 Jyear_1998 Jyear_1999 Iyear_.2000 Jyear_.2001 Jyear_.2002 Iyear_.2003 Iyear_.2004 Iyear_.2005 lyear_.2006 Iyear_.2007 Jyear_.2008 Jyear_.2009 th yj uy ip = = = = = = = = la c 5) ( 6) ( 7) ( 8) 9) c (10) (11) (12) (13) (14) 311) = I = = =0 = =0 = = =0 = 0 =0 =0 = =0 =0 = 311) = F( 14, Prob > F = 6_28 0.0000 5.80 0.0000 n Prob > F Jyear_1996 Jyear_1997 Iyear_1998 Jyear_1999 Iyear_.2000 Jyear_.2001 Jyear_.2002 Iyear_.2003 Iyear_.2004 Iyear_.2005 Jyear_.2006 Jyear_.2007 Jyear_.2008 Iyear_.2009 va 14 ( 2) ( 3) ( 4) n F( = c 1) 0 0 0 0 0 0 0 a lu (10) (11) (12) (13) (14) ad ( 8) ( 9) = = = = = Figure C-15: Test for time fixed effects in the FEM model2b- using PRIVATECREDIT m ll fu Heteroskedasticity Tests for Two-way FEM Regressions Models n oi Figure C-17: HET Test for the REM mode/1 tz LR chi (23) Prob > chi2 ikelihood-ratio test (Assumption: Restricted nested in Unrestricted) 249.26 0.0000 z vb jm ht Figure C-18: HET Test for the Two-way FEM Madella - using LL Y k Modified Wald test for groupwise heteroskedasticity in fixed effect regression model 1314_79 l.c 0.0000 om chi2 (24) = Prob>chi2 = gm HO: sigma(i)A2 = sigmaA2 for all i r (24) r'ob>chi 1239.9.1 = n chi P va HO: sigma(i)A2 = sigmaA2 for all i an Modified Wald test for groupwise heteroskedasticity in fixed effect regression model Lu Figure C-19: HET Test for the Two-way FEM Mode/2b- using PRIVATECREDIT o_oooo C-10 (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries - - - (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries APPENDIX D REGRESSION MODEL RESULTS to tn Figure D-1: The REM mode/1 with Robust Standard Errors gh ie p R-sq: n w " Number of obs Number of groups Random-effects GLS regression Group variable: country lo within between overall ad th corr(u_i, X) = Obs per group: = avg = = 0.1578 = 0.3132 = 0.1939 15 15.0 15 max = Wald chi2(9) Prob > chi2 = (assumed) u yj 83.80 0.0000 = = (Std Err adjusted for' 24 clusters in country) Robust Std Err p yi GROWTH 360 24 = Coef la 044383 -.921372 1109555 1.164496 -.2014226 -.7634579 -.0315076 0436342 2446693 4.056647 sigma_u sigma_e rho 1.110122 3.6654267 08401922 096054 5800785 0603592 1.017392 0829336 456565 0070633 0276181 1.18712 7.325578 n a lu FDI iGDP INVEST OPENNESS GOVEXP POP INFLATION EDUC GOVEFF _cons z [95% Conf Interval] P>lzl n va ll fu 0.644 0.112 0.066 0.252 0.015 0.094 0.000 0.114 0.837 0.580 oi m 0.46 -1.59 1.84 1.14 -2.43 -1.67 -4.46 1.58 0.21 0.55 -.1438794 -2.058305 -.0073463 -.8295569 -.3639695 -1.658309 -.0453514 -.0104962 -2.082044 -10.30122 2326453 2155609 2292573 3.158548 -.0388757 1313931 -.0176637 0977647 2.571383 18.41452 nh at (fraction of variance due to u_i) z z j ht vb k m om l.c gm an Lu n va r , D-11 (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries Figure D-2: The Two-way FEM Regression Model 2a with Robust Standard Errors- using LLY Number of obs = 360 F( 25, 311) = 6.86 Prob > F = 0.0000 R-squal'ed 0.5824 = Adj R-squal'ed = 0.5179 Root MSE 3.203 = t to Linear regression, absorbing indicators ng ep hi w n lo ad 0923979 0236118 0010214 2.901285 043795 1.747161 1197131 511516 0073417 0299537 1.257938 9490902 9633381 1.050055 1.019555 940828 1.060464 1.026825 1.058166 1.12246 1.318707 1.514717 1.46837 1.704235 738655 17.6363 th yj uy ip n a lu la n m ll fu -2.79 -2.57 3.69 -2.57 2.98 2.50 -1.67 1.28 -5.55 0.21 2.01 -0.09 -0.39 -1.85 -0.54 0.79 0.10 1.41 2.62 3.17 2.78 3.18 3.92 2.23 0.27 2.15 0.006 0.011 0.000 0.011 0.003 0.013 0.095 0.202 0.000 0.833 0.045 0.927 0.695 0.065 0.592 0.432 0.924 0.159 0.009 0.002 0.006 0.002 0.000 0.027 0.788 0.033 n oi absorbed -.4397436 -.1072151 0017609 -13.1691 0445064 9265162 -.4360644 -.3527452 -.0551937 -.0526108 0545497 -1.95499 -2.274003 -4.007221 -2.553494 -1.110268 -1.98551 -.5697447 6883111 1.35174 1.068996 1.829237 2.863744 4402045 -2.953068 3.166594 -~ - jm ~ -.0761353 -.0142969 0057802 -1.7518421 2168502 7.802017 0350356 1.660194: -.0263023 0652644 5.004839 1.77991 516966 1249995 1.458701 592119 2.187673 3.47106 4.852449 5.768894 6.258426 7.790016 8.642137 7.146782 3.888961 72.56969 (24 categories) ht country (95% Conf Interval] P>ltl vb -.2579394 -.060756 0037706 -7.460473 1306783 4.364267 -.2005144 6537246 -.040748 0063268 2.529694 -.0875398 -.3785189 -1.941111 -.5473965 7409255 1010817 1.450658 2.77038 3.560317 3.663711 4.809626 5.752941 3.793493 4679464 37.86814 va FDI LLY FDixLLY iGDP INVEST OPENNESS GOVEXP POP INFLATION EDUC GOVEFF _Iyear_1996 _Iyear_1997 _Iyear_1998 _Iyear·_1999 _Iyear_2000 _Iyear_2001 _Iyear_2002 _Iyear_2003 _Iyear·_2004 _Iyear_2005 _Iyeal'_2006 _Iyear_2007 _Iyear_2008 _Iyear_2009 _cons t z Robust Std En tz Coef GROWTH - k gm Figure D-3: The Wald Test on joint significance of POP in the Two-way FEM Model 2a -using LL Y om l.c test POP 1, 311) Prob > F = = 1.63 0.2022 n va F( an POP = Lu ( 1) r • D-12 (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries to Figure D-4: The Two-way FEM Regression Madella with Robust Standard Errors- using LLY after eliminating POP tn Number of obs F( 24, 312) Prob > F R-squared Adj R-squared Root MSE gh Linear regression, absorbing indicators ie p = = = = = = 360 7.18 0.0000 0.5803 5171 3.2059 n w FDI LLY FDixLLY iGDP INVEST OPENNESS GOVEXP INFLATION EDUC GOVEFF _Iyear·_l996 _Iyear_l997 _Iyear_l998 _Iyear_1999 _Iyear_2000 _Iyear_2001 _Iyear_2002 _Iyear_2003 _Iyear_2004 _Iyear_2005 _Iyear_2006 _Iyear_2007 _Iyear_2008 _Iyear_2009 _cons -.2467751 -.0611298 0036947 -6.834686 1329217 4.114813 -.2056224 -.0409213 0060879 2.784116 -.1301899 -.448146 -2.018622 -.6499046 6220635 -.0281213 1.297167 2.61226 3.402253 3.46758 4.520441 5.374294 3.365265 -.0070936 35.85051 090422 0234052 0010048 2.854349 0436247 1.707731 1195829 0070627 0313833 1.247458 934478 9591465 1.037569 1.001266 9100522 1.042639 1.007889 1.036828 1.097374 1.294105 1.472139 1.42028 1.641883 1.675401 17.49612 ad th u yj n a lu la n va ll fu -2.73 -2.61 3.68 -2.39 3.05 2.41 -1.72 -5.79 0.19 2.23 -0.14 -0.47 -1.95 -0.65 0.68 -0.03 1.29 2.52 3.10 2.68 3.07 3.78 2.05 -0.00 2.05 [95% Conf Interval] P>ltl oi m nh at 0.007 0.009 0.000 0.017 0.003 0.017 0.087 0.000 0.846 0.026 0.889 0.641 0.053 0.517 0.495 0.978 0.199 0.012 0.002 0.008 0.002 0.000 0.041 0.997 0.041 -.4246892 -.1071817 0017176 -12.45089 0470858 7546861 -.4409133 -.0548179 -.0556617 3296213 -1.968866 -2.335359 -4.060139 -2.619992 -1.168552 -2.079615 -.6859515 5721997 1.243063 921304 1.623866 2.579756 1347016 -3.303607 1.425206 z j ht country p yi , t vb Robust Std Err z Coef lo GROWTH absor·bed (24 categories) m - -.068861 -.0150778 0056718 -1.218479 2187575 7.474939 0296686 -.0270248 0678375 5.238611 1.708486 1.439067 0228948 1.320183 2.412679 2.023372 3.280286 4.652319 5.561442 6.013856 7.417016 8.168831 6.595829 3.28942 70.2758 - k test EDUC 1, 312) = > F = 0.04 0.8463 n Pr~ob va F( =0 an EDUC Lu ( 1) om l.c • gm Figure D-5: The Wald Test on joint significance of EDUC in the Two-way FEM Model 2a -using LL Y r D-13 (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries Figure D-6: The Two-way FEM Regression Model 2b with Robust Standard Errors-using PRIVATECREDIT to tn Number of obs = 360 F( 25, 311) = 6.63 Prob > F = 0.0000 R-squared 5761 = Adj R-squared = 5107 Root MSE 3.227 = gh Linear regression, absorbing indicators ie p n w -.2265723 -.0528343 0047063 -7.410809 144302 4.065401 -.2247779 5503388 -.0411492 0027775 2.486295 -.1314264 -.3712222 -2.113059 -.9192629 3342861 -.4361131 8086782 2.188864 2.989104 3.240965 4.341027 5.25256 3.339857 -.1229632 38.34295 0976368 0222776 0016475 2.877987 0483589 1.671793 1200745 5429731 007697 0315651 1.21862 1.006511 9837842 1.046351 1.041934 9480375 1.039433 1.004106 1.048949 1.113439 1.298892 1.511326 1.45962 1.70855 1.782405 16.85323 ad th u yj p yi n a lu la n ll fu -2.32 -2.37 2.86 -2.57 2.98 2.43 -1.87 1.01 -5.35 0.09 2.04 -0.13 -0.38 -2.02 -0.88 0.35 -0.42 0.81 2.09 2.68 2.50 2.87 3.60 1.95 -0.07 2.28 oi m nh at 0.021 0.018 0.005 0.010 0.003 0.016 0.062 0.312 0.000 0.930 0.042 0.896 0.706 0.044 0.378 0.725 0.675 0.421 0.038 0.008 0.013 0.004 0.000 0.052 0.945 0.024 z absorbed -.4186846 -.0966682 0014646 -13.0736 04915 775946 -.461039 -.5180265 -.0562939 -.0593306 0885127 -2.111859 -2.306937 -4.171881 -2.969393 -1.531093 -2.481323 -1.167021 124929 7982777 6852368 1.367311 2.380581 -.0219223 -3.630061 5.182178 -.03446 -.0090004 007948 -1.748022 2394541 7.354856 0114832 1.618704 -.0260044 0648855 4.884077 1.849006 1.564492 -.0542372 1.130868 2.199665 1.609097 2.784378 4.252798 5.17993 5.796693 7.314743 8.124538 6.701636 3.384135 71.50371 (24 categories) k m countr·y va FDixPRIVAT-T iGDP INVEST OPENNESS GOVEXP POP INFLATION EDUC GOVEFF _Iyear_l996 _Iyear_l997 _Iyear_l998 _Iyear_l999 _Iyear_2000 _Iyeat'_2001 _Iyear_2002 _Iyear·_2003 _Iyear_2004 _Iyear·_2005 _Iyear_2006 _Iyear·_2007 _Iyear_2008 _Iyear·_2009 _cons [95% Conf Interval] P>ltl j ht FDI PRIVATECRE~T t vb Robust Std Er'r z Coef lo GROWTH F( 1, 311) Prob > F • D-14 = 1.03 0.3116 n = va POP an ( 1) Lu test POP om l.c • gm Figure D-7: The Wold Test on joint significance of POP in the Two-way FEM Model2b- using PRIVATECREDIT (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries to Figure D-8: The Two-way FEM Regression Model 2b with Robust Standard Errors-using PRIVATECREDIT after eliminating POP tn Number of obs = 360 F( 24, 312) = 6.89 Prob > F 0.0000 = R-squared 0.5746 = Adj R-squared = 0.5106 Root MSE = 3.2275 Linear regression, absorbing indicators gh ie • p n w FDI -.2213065 -.0513155 0047374 -6.968327 1467062 3.840885 -.2278498 -.0413748 0018828 2.73695 -.1690432 -.4311495 -2.172115 -.9990131 2405171 -.5347169 6953581 2.072405 2.875725 3.090106 4.111373 4.943612 2.998962 -.5105703 37.22432 0969968 0220347 0016243 2.847722 0479926 1.627826 1200525 0074481 0325724 1.21093 9844843 970456 1.0369 1.020748 9156043 1.017564 9825771 1.026967 1.09063 1.27609 1.475846 1.413198 1.654077 72131 16.74387 ad th PRIVATECRE~T u yj FDixPRIVAT~T n a lu la n va ll fu [95% Conf Interval] P>ltl -2.28 -2.33 2.92 -2.45 3.06 2.36 -1.90 -5.56 0.06 2.26 -0.17 -0.44 -2.09 -0.98 0.26 -0.53 0.71 2.02 2.64 2.42 2.79 3.50 1.81 -0.30 2.22 oi m nh at 0.023 0.021 0.004 0.015 0.002 0.019 0.059 0.000 0.954 0.024 0.864 0.657 0.037 0.328 0.793 0.600 0.480 0.044 0.009 0.016 0.006 0.001 0.071 0.767 0.027 -.4121571 -.0946709 0015415 -12.57149 0522761 6379807 -.4640646 -.0560296 -.0622066 3543276 -2.106111 -2.340615 -4.212315 -3.007433 -1.561023 -2.536873 -1.237957 0517487 7298054 5792758 1.207503 2.163009 -.2555937 -3.897414 4.279148 z j ht country p yi iGDP INVEST OPENNESS GOVEXP INFLATION EDUC GOVEFF _ryear_l996 _Iyear_l997 _Iyear_l998 _Iyear_l999 _Iyear_2000 _Iyear_2001 _Iyear_2002 _Iyear_2003 _Iyear_2004 _Iyear_2005 _Iyear'_2006 _ryear_2007 _Iyear·_2008 _Iyear_2009 _cons t vb Robust std Err z Coef lo GROWTH absorbed -.0304559 -.0079601 0079334 -1.36516 2411364 7.043789 008365 -.0267201 0659721 5.119572 1.768025 1.478316 -.131915 1.009407 2.042057 1.467439 2.628673 4.093061 5.021644 5.600935 7.015243 7.724216 6.253518 2.876273 70.1695 I (24 categories) k m - EDUC =0 D-15 r 0.00 0.9539 n 1, 312) = Prob > F = va F( an ( 1) Lu test: EDUC om l.c fl gm Figure D-9: The Wald Test on joint significance of EDUC in the Two-way FEM Mode/2b- using PRIVATECREDIT (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries Final regression models: to tn gh inear regression, absorbing indicators ie Figure D-10: The final Two-way FEM Regression Modell a -using LL Y p Number of obs F( 23, 313) Prob > F R-squared Adj R-squared Root MSE n w ~ = = 360 7.48 = 0.0000 = 0.5802 = 0.5186 = 3.201 lo ad -.2466713 -.0602514 0036776 -6.867126 1329443 4.118697 -.2067933 -.0409251 2.806065 -.1222713 -.4359639 -1.99895 -.6200958 6571932 0166183 1.350196 2.68078 3.468395 3.548695 4.608533 5.469803 3.468786 0995689 36.37885 0902736 0231229 0010099 2.870681 043507 1.70669 119554 0070175 1.24679 932096 9618854 1.044489 9963094 908384 1.067383 1.005276 1.014971 1.090953 1.269214 1.431801 1.410299 1.640443 1.624664 17.51961 n a lu la n va ll fu oi m nh at 0.007 0.010 0.000 0.017 0.002 0.016 0.085 0.000 0.025 0.896 0.651 0.057 0.534 0.470 0.988 0.180 0.009 0.002 0.005 0.001 0.000 0.035 0.951 0.039 z -.424291 -.1057473 0016905 -12.5154 047341 7606607 -.4420243 -.0547325 3529145 -1.956237 -2.328543 -4.054057 -2.580406 -1.130118 -2.083534 -.6277568 6837505 1.321866 1.051426 1.791361 2.694938 2410967 -3.097075 1.907752 jm countr·y p yi "' u yj • -2.73 -2.61 3.64 -2.39 3.06 2.41 -1.73 -5.83 2.25 -0.13 -0.45 -1.91 -0.62 0.72 0.02 1.34 2.64 3.18 2.80 3.22 3.88 2.11 0.06 2.08 [95% Conf Interval] P>ltl ht FDI LLY FDixLLY iGDP INVEST OPENNESS GOVEXP INFLATION GOVEFF _Iyear_1996 _Iyear_1997 _Iyear·_l998 _Iyear_l999 _Iyear·_2000 _Iyear_2001 _Iyear_2002 _Iyear·_2003 _Iyear_2004 _Iyear·_2005 _Iyear_2006 _Iyear·_2007 _Iyear_2008 _Iyear·_2009 _cons t vb Robust Std Err z Coef th GROWTH absorbed -.0690515 -.0147555 0056647 -1.218855 2185475 7.476733 0284377 -.0271178 5.259215 1.711695 1.456615 0561577 1.340215 2.444504 2.11677 3.328149 4.677809 5.614924 6.045964 7.425705 8.244668 6.696476 3.296213 70.84994 (24 categories) k l.c gm om an Lu n va ~ D-16 (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries (Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries(Luận.văn).foreign.direct.investment financial.development.and.economic.growth.in.asian.developing.countries