The factors affecting Foreign Direct Investment (FDI) in Malaysia from 1988 to 2017 / Nurul Farrah 'Ain Abdul Aziz

• Main Author: Abdul Aziz, Nurul Farrah 'Ain
• Format: Student Project
• Language: English
• Published: 2018
• Subjects: Economics; Income. Income distribution. National income. Including gross national product, gross domestic product, and gross state product; Foreign investments. Country risk
• Online Access: http://ir.uitm.edu.my/id/eprint/39106/1/39106.pdf; http://ir.uitm.edu.my/id/eprint/39106/

The purpose of this study is to investigate the factors that affecting foreign direct investment in Malaysia. The independent variables are gross domestic product, government consumption expenditure, imports, exports, tax revenues, and inflation while the dependent variable is foreign direct investment (FDI). The study was conducted for 30 years from 1988 to 2017. Ordinary Least Square (OLS) results shows exports, tax revenues, and inflation are having a positive relationship with foreign direct investment. Only one variable which is tax revenues comes out with 0.7826 insignificant but it shows the positive relationship with foreign direct investment actually. This study also using the Granger Causality test to identify whether each of the variables are long run relationship or in short run relationship. The result shows that exports and inflation having two ways of relationship. In addition, the other variables shows only one way of relationship with foreign direct investment.