Title Page
Abbreviations
Abstract
요약
Contents
Chapter 1. Introduction 16
1.1. Research Problem Statement 17
1.2. Research Questions 18
1.3. Research Objectives 18
1.4. Significance of Study 18
1.5. Outline of Study 19
Chapter 2. Background of Study 20
2.1. Trends of FDI in Ethiopia 22
2.2. Trends of Economic Growth in Ethiopia 23
2.3. Sources of FDI Inflows to Ethiopia 24
Chapter 3. Literature Review 26
3.1. Theoretical Framework 28
3.1.1. Introduction 28
3.1.2. Exogenous Growth Model 29
3.1.3. Endogenous Growth Model 30
3.1.4. Solow Model 31
3.1.5. Conclusion 32
3.2. FDI as a Factor of Economic Growth 33
3.3. Concept of Causal Relationship 33
3.4. Review of Theories and Thoughts of Scholars on FDI 34
Chapter 4. Conceptual Framework 39
Chapter 5. Methodology 40
5.1. Introduction 40
5.2. Model Specification 40
5.2.1. Variables Explanation 42
5.2.2. Hypothesis 43
5.2.3. Method of Analysis 44
5.3. Unit Root Test: Augmented Dickey-Fuller Test 46
5.4. Co-integration Analysis: Bounds Test Approach 46
5.5. Toda-Yamamoto Approach to Granger Causality Test 49
5.6. Data and Data Sources 52
Chapter 6. Empirical Results 53
6.1. ARDL Bounds Test 54
6.2. The ARDL Short-Run Result 55
6.3. The ARDL Long-Run Result 57
6.4. Result of Stability Test 61
6.5. Toda Yamamoto Approach to Granger Causality Test 62
Chapter 7. Conclusion and Policy Recommendation 66
7.1. Conclusion 66
7.2. Policy Recommendations 67
References 69
Table 1. Foreign direct investment, net inflows (% of GDP) of Ethiopia from 1981-2019 21
Table 2. ADF Unit Root Test 53
Table 3. ARDL Bounds Test 54
Table 4. Critical Values Bounds 55
Table 5. ARDL Short Run Result 55
Table 6. Estimated Long-Run Coefficient ARDL Technique. 57
Table 7. Diagnostic Tests of the ARDL Model 59
Table 8. The Result of the Toda Yamamoto Approach Granger Causality Test 63
Figure 1. FDI, net inflows (% of GDP)-Ethiopia from 1980-2020 21
Figure 2. Trends of FDI and RGDP in Ethiopia (1970– 2021) 23
Figure 3. FDI Inflows to Ethiopia by Continent of Origin%. 25
Figure 4. FDI Inflows to Ethiopia by Countries of Origin%. 25
Figure 5. Relationship between Dependent & Independent Variables 39
Figure 6. CUSUM Stability Test 61
Figure 7. CUSUMSQ Stability Test 62