Foreign direct investment, export and economic growth in Pakistan, Iran, Turkey, and Malaysia: Multivariate var analysis

The main purpose of this paper is to study the dynamic relationship between FDI, GDP, and Export in Pakistan, Iran, Turkey, and Malaysia which are at different stages of growth and a study of the impact of FDI on GDP and export enable to compare the economic growth of these countries. To identify the causual relationship among these variables, Johansen co-integration test for the study of long run relationship and VECM estimates for short run relationships have been used during the present study. There exists a long run relationship among these variables for all the countries. The short run dynamics show error correction estimates for these countries as 62%, 59%,72%, and 57% respectively for Pakistan, Iran, Turkey, and Malaysia. VAR Granger Causuality results show, in Pakistan Export Granger cause FDI and GDP. In Iran FDI Granger cause export and in Turkey export Granger cause GDP.