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Exploring The Relation Between Sectoral Foreign Direct Investment And Domestic Investment: Case For Turkey, Selin Erkan
Exploring The Relation Between Sectoral Foreign Direct Investment And Domestic Investment: Case For Turkey, Selin Erkan
Dissertations and Theses
This thesis investigates the relationship between Foreign Direct Investment (FDI) and domestic investment in Turkey during 2005Q1-2016Q2 to see if there is a crowding-in or crowding-out relationship. Sectoral FDI data for manufacturing, agriculture and service are employed and gross fixed capital formation is used as a proxy for domestic investment. GDP and export are used as control variables. A VAR model estimates negative coefficients of sectoral FDI on domestic investment indicating that there is some crowding-out in Turkey during 2005Q1-2016Q2 although not one-for-one. These negative effects are concentrated in the manufacturing sector.