Effects of the 2008 Financial Crisis on developing Asia's Economic Growth

Abstract

The aim of this paper is to study macro aspect of the virulent impacts of the 2008 financial crisis on Asian developing economies. To do this, we apply the Pedroni panel co-integration technique developed to examine the long-run relationship between economic growth, exports and inward FDI on a sample of selected Asian developing countries over the period 1995-2008. Our main finding is that FDI inflows and exports exert a significant and positive impact on developing Asia's economic growth. The 2008 global financial crisis is, therefore, likely to have a significant effect on developing Asia's economic growth through two main transmission channels - FDI and exports channels.Financial crisis, Exports, FDI, Economic growth, Developing countries.