The relationships between foreign direct investment, export and economic growth

Abstract

This study aims to examine the causal relationship between foreign direct investment, exports and economic growth in Dong Nai province, Vietnam from 1999 to 2019. The study uses several economic models such as Vector Auto Regression - VAR (p), Vector Error Correction Model (VECM) and Granger causality tests to evaluate relationships between research model variables. The results show that foreign direct investment and exports have the positive effects on Gross Regional Domestic Product (GRDP). Therefore, this study recommends some policy implementation to simulate the foreign direct investment. Particularly, the policy makers in Dong Nai province should be aware of the role of foreign direct investment and export incentive policies, which is an important driving force for the socio-economic development of Dong Nai province, Vietnam.