Foreign Direct Investment Flows in Developing Countries: Relevance of Economic, Social and Political Globalisation

Abstract

This study seeks to depict the relationship between the ingress and egress of international capital and globalisation, which is encompassed by economic, social and political globalisation indices. To address this objective, a generalised vector autoregressive model has been applied to fifty years (1973–2022) of secondary data. The empirical result depicts a significant and positive relationship among the said variables in the long run. In the short run, economic globalisation and social globalisation show the significant impact of foreign direct investment, whereas political globalisation has no more influence on it. Hence, these results help policymakers to pay attention to the development of economic and social globalisation processes for the economic development of the nation through foreign direct investment inflow.