Foreign direct investment as a pull factor of the economic growth in Ukraine in the period 2003-2016

Abstract

Objective: The aim of this paper is to present the results of investigation of the interlink between FDI and the economic growth in Ukraine in the period 2003-2016. Research Design & Methods: Methods applied in the study are analysis and synthesis of the literature on the subject as well as quantitative tools: descriptive statistics and linear regression. The GDP per capita and FDI inflow are taken into account in years 2003-2016. Findings: Many researchers relate the impact of FDI on the economic growth as the positive one. Basing on the literature review, the regression model was used to identify the behaviour of the interlink in the example of one developing country and the economic growth was expressed by the indicator GDP per capita. This paper highlights and proves the positive impact of FDI on the economic growth in Ukraine in the analysed period with the use of regression model. Moreover, the political instability has a negative impact on both FDI inflows and the economic growth. Contribution & Value Added: The originality of this research is in introducing and highlighting the importance of involving the FDI in Ukraine in order to reach speeder economic growth.

Keywords

• FDI
• economic growth
• Ukraine
• neo-classical growth theory
• factors of production
• regression model approach