CAUSAL LINKS BETWEEN FOREIGN DIRECT INVESTMENT AND TRADE IN TURKEY

Burcu KIRAN

Abstract


This paper investigates the empirical evidence on the link between foreign direct investment and trade (export and import) in Turkey over the period from 1992:01 to 2008:04 by using the minimum LM unit root test for stationarity; Granger and Dolado-Lüthkepohl tests for causality. The test results based on the bi-variate VAR model indicate that there is no evidence of causality between foreign direct investment and trade in Turkey.


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International Journal of Economics and Finance  ISSN  1916-971X (Print) ISSN  1916-9728 (Online)

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