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International Journal Of Engineering, Business And Management(IJEBM)

Does Macroeconomic factors Impact on Foreign Direct Investment in emerging economies?(Pakistan)

Mr. Rizwan Ullah Khan , Ms. Sobia

International Journal of Engineering, Business And Management(IJEBM), Vol-3,Issue-3, May - June 2019, Pages 55-64 , 10.22161/ijebm.3.3.1

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Foreign direct investment is essential for economic growth of a country. It acts as a promoter for the economic development of a country. Keeping this in mind, the objective of this study is to determine the effect of macroeconomic variables such as interest rate, real exchange rate,inflation rate and stock market on foreign direct investment in Pakistan. For this purpose,study used the authentic annual data for the period of 27 years i.e. from 1990-2016. We are use for analysis E-View software, The empirical analysis involved using the ADF test to check the stationary of the data.Results revealed that interest rate and exchange rate have significant negative effect on FDI and stock market index has negative and unsignificant effect on FDI while inflation rate has positive and significant effect on FDI.

real interest rate, real exchange rate, inflation rate, stock market index, Foreign direct investment.

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