The relationship amongst financial development, economic growth, and foreign direct investment in Vietnam

Tóm tắt

In international development, the relationship between economic development and foreign direct investment (FDI) has long been a topic of great interest. Although this interest has provided a wealth of information regarding the effects FDI on growth in developing countries, there has been little empirical analysis of the linkages in Vietnam compared with other developing countries. Therefore, this study investigates the impact of FDI inflows on economic development including economic growth and financial development in Vietnam. Utilizing data from 1990 to 2019, the purpose of this study is to investigate the impacts of FDI inflows on financial development, economic growth, and further explore the factors influencing the economic development and regulatory quality by using robust least squares (RLS) method. The approach is statistical and descriptive in nature, and it is used to assess the current state of the qualitative link between environmental quality and FDI. In addition, the study uses comparative and absolute methods to evaluate. The method of synthesis and analysis aims to clarify the role of FDI in economic growth in Vietnam as a basis for giving effective measures to attract and manage FDI and promote growth. Empirical results show that FDI, domestic investment, and trade openness positively impact economic growth. Moreover, the impact of government consumption on economic growth is negative and not statistically significant. Ultimately, this paper suggests that the Vietnamese government should improve regulations governing business operations by easing the process of starting a business, controlling prices, and augmenting cooperation between training centres and Foreign-invested enterprises