Foreign direct investment inflow: The drivers and motivations in MENA Region

Purpose ― Reasons why Multinational Enterprise (MNEs) engage in foreign direct investment (hereafter referred to as FDI) abroad have been of great interest to policy markets, academia and international portfolio investors. This examines FDI inflow motives to the Middle East and North Africa (MENA) region for the period 2005 to 2019. Design/methodology/approach ― This research paper applies both the static and dynamic panel methodologies such as SYS-GMM, fixed effects, and pooled OLS estimators to investigate the motivational factors of MNEs FDI inflows to MENA countries. Findings ― Although specificity applies to countries, estimated results suggest that MNEs in the MENA region are predominantly interested in serving both home and host markets. Other motives such as efficiency-seeking FDI vary across countries, indicating that FDI motives are not homogeneous among region members. This paper provides useful insight for both firms and host countries in the region. Originality/value ― This research paper investigates the factors that motivate MNEs to consider FDI decisions in MENA countries. Rather than investigate the individual countries within the region as done in existing literature, this research paper simultaneously examines MNEs' investment motivations in the MENA region. The findings are significant, plausible and in line with the economic development of most countries in the region

Statistical Analysis of Industrial processed Cheese puffs

This paper studied and fit a Multivariate linear regression model to the relationship between the response variables; Weight and Bulk density on one hand, and the predictor variables; Temperature, Moisture content before extrusion and Moisture content after extrusion on the other hand, of Cheese puffs product, manufactured by Zubix Company Limited, Anambra, Nigeria. A sample size of three hundred (300) cheese puffs packs were collected from a population of two-thousand, seventy-eight batches between August 2013 to June 2014, examined and used for analysis. A temperature of 186.67\u2103 was discovered to be significantly related to the response variable

FDI outflows and international trade nexus: Empirical evidence from country income groups

Relevance. Outward foreign direct investment (OFDI) and international trade are traditionally viewed as key drive of economic integration and globalization. At the same time, the relationship between these phenomena is ambiguous both from theoretical and empirical points of view. This study contributes to the existing literature by analyzing the relationship between outward foreign direct investment and international trade for countries with different levels of income per capita.Research objective. This study examines the dynamic interplay between OFDI and international trade in different income groups such as low-income (LIC), low-middle income (LMIC), upper-middle income (UMIC), and high-income (HIC) groups.Data and methods. Based on World bank country income classifications, data from 161 countries are divided into LIC, LMIC, UMIC, and HIC for the period 1998-2019. The study employs the Difference (DFF-GMM) and two-step System Generalized Method of Moments (SYS-GMM) techniques to explore the OFDI-trade nexus.Results. The results are mixed and significant providing support for both complementarity and substitutive FDI. Findings suggest that OFDI and trade nexus in LIC have negative impact indicating a substitutive effect, but in other economies, the impact is significantly positive and complementary.Conclusions. Trade and OFDI nexus are substitutive in LIC, hence sound economic policy, aimed at increasing country’s international competitiveness, should be adopted. However, trade and OFDI in LMIC, UMIC and HIC economies have mutually complementary relationship that facilitates the improvement of the domestic economy. Thus, government should promote policies that sustain the benefits of OFDI and trade interactions

Testing for causality in mean and in variance among the U.S., China, and some Africa capital markets: A CCF approach

Aim/purpose – Owing to the huge risk occasioned by negative contagion effects associated with financial market linkages, markets participants and academia have continued to examine the capital market cross country interdependence at different levels. In this paper, we examined the causal relationships among the U.S., China and some top African capital market indexes. Design/methodology/approach – To examine the mean and variance causal effects, we estimated a univariate AR-EGARCH model for all capital market indexes. Then employed the residual-based two-step bivariate cross-correlation function (CCF) test developed by Cheung & Ng (1996). The test statistics had a well-defined asymptotic standard distribution that was robust to distributional assumptions. Findings – We detected both the feedback and unidirectional causality effects among African capital markets. These results show that African financial markets are still not fully integrated within the African continent. Expectedly, the results from our empirical analysis showed the existence of a unidirectional causality both in mean and variance from the U.S. and Chinese markets to African capital markets. This demonstrated that events in the U.S. and China are not irrelevant to African markets. Research implications – Owing to the fact that knowledge of other financial markets provides adequate information about a market situation, the results from this research paper will be helpful for the policymakers of African countries in shaping their economic policies, help investors diversify investments with less risk, and international portfolio managers make portfolio allocation decisions. Originality/value/contribution – This paper examined the mean and risk dynamics of three top African, the U.S., and Chinese capital markets with their interdependence using the CCF approach. Furthermore, to the best of our knowledge, no previous re-search paper on this issue exists

Impact of oil price shock on foreign currency and stock markets: The Nigeria perspective

No Astrac

Power and Size analysis of Co-integration tests in Conditional Heteroskedascity: A Monte Carlo Simulation

This paper investigates the finite sample performance of power and size properties of several major co-integration tests using simulation analysis. These tests include; the co-integration Regression Durbin-Watson test (CRDW), Eagle-Granger test, Dicky Fuller unit root test with () statistics, Johansen likelihood ratio tests, and Phillips-Ouliaris test. Comparisons of tests are evaluated based on the proportion of rejects of the hypothesis of a no co-integration. This study answers the question of which co-integration test is better, particularly between the Eagle-Granger two-step test and the Johansen’s tests for co-integration, when the sets of parameters in models are persistence and spiky. The bivariate Generalized Autoregressive Conditional Heteroskedasticity (GARCH(1,1)) model with Gaussian innovations, is used in the data generating process (DGP). Our simulation results reveal that there is size distortion in the different co-integration test considered. The Eagle-Granger two-step test shows good robustness with respect to heteroskedasticity for the different sample sizes applied. However, the Johansen’s test for co-integration still proves to be powerful in capturing co-integration relationship, particularly for large sample when the co-integration innovations are Gaussian