Quantitative and Mathematical

The empirical analysis of technology and foreign direct investments

The main aim of this study is to analyze the relationship between foreign direct investment and R&D spending using panel co-integration methods for upper middle-income economies and high-income economies. A larger level of investment is needed to increase the capital stock in order to ensure growth, but the typically low savings rate makes this difficult to achieve. Theoretically, it is expected that foreign direct investments would solve the saving inadequacy problem of the target country leading to economic growth by increasing capital accumulation.