—China has been one of the world’s most important recipients of FDI and accomplished fast economic growth. This paper aims to explain the factors contributing to the inward FDI in China from 1985 to 2014 with empirical study. The elements studied include international trade, external debt ratio, GDP growth rate, CPI, technology development, labor and wage levels. It shows that debt level, international trade and lifting wages have negative effect on FDI while GDP growth rate, CPI and the abundance of Labor contribute positively to FDI. Granger causality test is performed with policy implications and suggestions presented at the end.
—FDI, debt, economic growth, emerging market.
The authors are with the Northwest University, School of Economics and Management, Xian, 710127 China (e-mail: firstname.lastname@example.org).
Cite: Zhou Ming Matt and Wang Man Cang, "Perspectives on FDI, Debt and Economic Growth in Emerging Markets: Evidence from China," International Journal of Trade, Economics and Finance vol.7, no.4, pp. 148-152, 2016.