The FDI role in economic development: A study of Vietnam

Abstract:

This study aims to investigate the role of Foreign direct investment (FDI) in Economic development by assessing its relationship with GDP per capita in Vietnam during the period 1986-2020 through descriptive statistical, correlation matrix analysis, and the Vector error correction model (VECM) with time-series data. The empirical results show that FDI has a significant positive relationship with Economic development in the short run, while not finding a long-run relationship. In addition, it is found that a clear relationship between Exports and Economic development in both the short run and long run. Meanwhile, CO2 emissions and Employment opportunites have no clear relationship with Economic development in the short run, however the relationship is reserved in the long run. From these findings, authors propose some policy implications of attaching FDI to sustainable Economic development in Vietnam in the coming time.