Foreign Direct Investment and Economic Growth in Azerbaijan An Examination of Theories and Correlations
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| Dokumentumtípus: | Diplomadolgozat |
| Kulcsszavak: | ARDL Azerbaijan economic growth fdi foreign direct investments Time Series |
| Online Access: | http://dolgozattar.uni-bge.hu/56609 |
| Kivonat: | This thesis investigates the connection between foreign direct investment (FDI) and Azerbaijan's economic growth, especially in light of the country's shift from a centrally planned to a market-oriented economy after the fall of the Soviet Union. Amidst socio-economic challenges compounded by conflicts and limited financial resources, FDI, notably exemplified by the "Contract of the Century" in 1994, emerged as a crucial catalyst in rejuvenating Azerbaijan's oil sector and fostering overall economic advancement. In an era characterized by globalization and the imperative of sustainable development, understanding the mechanisms through which FDI shapes economic progress holds significant implications for policymakers, investors, and scholars alike. By employing both theoretical analysis and empirical investigation, this study seeks to elucidate these dynamics within the unique context of Azerbaijan. The research delves into the connection between foreign direct investment and the economic trajectory of Azerbaijan, employing time series econometric methodologies. Covering the period from 1993 to 2022, the analysis scrutinizes the dynamics between the annual GDP growth rate and the percentage of FDI relative to GDP. Multiple econometric techniques, including Autoregressive Distributed Lag (ARDL), Phillips-Perron (PP), and Augmented Dickey - Fuller (ADF) tests, are utilized. The empirical findings underscore a robust and positive correlation between FDI inflows and the expansion of Azerbaijan's economy. This relationship is considered significant not only in the short term but also in fostering long-term GDP growth. Particularly, the AutoRegressive Distributed Lag (ARDL) model highlights FDI's consistent and favorable impact on the economic advancement of Azerbaijan. |
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