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Jurnal Ekonomi Malaysia

49 (1) 2015 49 – 60

Pelaburan Langsung Asing, Pertumbuhan Ekonomi dan Kualiti Pembangunan Pasaran Saham – Analisis Panel
Foreign Direct Investment, Economic Growth and Quality of Stock Market Development – Panel Analysis

Fakulti Pengurusan dan Muamalah
Kolej Universiti Islam Antarabangsa Selangor

norhakimah@kuis.edu.my

Graduate School of Business
Universiti Kebangsaan Malaysia

swlow@ukm.edu.my

Fakulti Ekonomi dan Pengurusan
Universiti Kebangsaan Malaysia

ahassan@ukm.edu.my

Abstract

This study examines the role of stock market development quality in enabling foreign direct investment to promote economic growth for a sample of thirty developed and emerging countries over the period from 1999 to 2009, using dynamic panel GMM estimator. The quality of stock market development is examined using two indicators of market liquidity and pricing efficiency, measured using volume turnover scaled by return volatility and stock price synchronicity respectively. The findings indicate that higher stock market development quality as reflected by higher levels of market liquidity and pricing efficiency are more able to benefit from the growth effects of FDI. In the greater context, this study establishes a new form of absorptive capacity by showing that the quality dimension of stock market development constitutes an important element in influencing the impact of FDI on economic growth. Insights from this study suggest that it is important to address the quality aspect of stock market development in enabling FDI to serve as an important driver of economic growth. The findings expand the existing literature and provide a clearer understanding of the FDI financial development-growth nexus.

Keywords

economic growth; Foreign direct investment; stock market development quality
http://dx.doi.org/10.17576/JEM-2015-4901-05
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Haji Mohd Nor, , Low, , & Mohd Nor, (2015). Pelaburan Langsung Asing, Pertumbuhan Ekonomi dan Kualiti Pembangunan Pasaran Saham – Analisis Panel. Jurnal Ekonomi Malaysia, 49(1), 49–60. http://dx.doi.org/10.17576/JEM-2015-4901-05

@article{mohdnor2015pelaboran,
  title={Pelaburan Langsung Asing, Pertumbuhan Ekonomi dan Kualiti Pembangunan Pasaran Saham – Analisis Panel},
  author={Haji Mohd Nor, Nor Hakimah and Low, Soo Wah and Mohd Nor, Abu Hassan Shaari},
  journal={Jurnal Ekonomi Malaysia},
  volume={49},
  number={1},
  pages={49—60},
 

year={2015},
}

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