A STUDY ON FDI AND ECONOMIC GROWTH IN SELECTED ASSOCIATIONS: EVIDENCE FROM GRANGER CAUSALITY TEST

The study was carrying out to find a relation between FDI and economic growth in various associations by having evidence from granger causality test. Study was done by using data on GDP & FDI from year 1970 to till 2008.Various analytical tools such as descriptive statistics, correlation among GDP & FDI of various associations, ADF test & granger causality test was applied to find that is there is any granger cause or not. The study gives result that there is somewhat positive & somewhat negative correlation among GDP & FDI of various associations. ADF test was applied to test whether data is stationary or not. Moreover, FTAA & APTA member nations, found FDI’s granger cause to GDP where as both ASEAN & NAFTA member nations, FDI can granger cause to GDP & GDP can granger cause to FDI.