Abstract

This paper examines the relationship between foreign direct investments and economic growth of Bangladesh during the period 1972–2011. After reviewing the literature on the factors affecting the growth of the economy of the country, the paper empirically evaluates the most significant factors that may influence the growth of the economy of Bangladesh during the period of 1972–2011. This study evaluates the association between FDI and economic growth using multiple regression method by considering relationship between real gross domestic product, foreign direct investment, domestic investment and openness of the trade policy regime. The results indicate that domestic investments exert positive influence on economic growth whereas foreign direct investments, openness of trade are less significant.

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