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This question might look easy for you, but I am kind of new to econometrics and I need your advice.

I am writing a paper where I am researching the relationship of Foreign Direct Investment (FDI) on Gross Domestic Product (GDP). To measure the relationship between FDI and GDP I am thinking to use multiple linear regression, where I would get the significant answer.

But it is not enough for a research paper, so I am planning to investigate from a GDP branch perspective. I have found all the data from every field, like manufacturing, agriculture and etc. branches, which combined is GDP and I would like to investigate each of them.

What method would you suggest to use in order to research the relationship between Foreign Direct Investment and a specific branch of Gross Domestic Product?

Thank you in advance,

Z

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Regression can be one of the ways to find relation between GDP and FDI. If you are looking for causation, there is not statistical test. https://www.researchgate.net/post/Any_recommended_techniques_for_testing_causal_relations

Also generally FDI depends on GDP but is it always true ? I think SEM( Structured Equation Modeling) would better find inter-relation between these variables. SEM would also help in identifying relation between different component of GDP.

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