Earlier studies on the impact of foreign direct investment (FDI) on economic growth have not been instructive largely on their failure to examine the sectoral transmission channels through which FDI affects overall growth. We re–examine the impact of FDI on economic growth in Africa relying on panel data from 38 African countries over the period 1960–2014. Results from the system generalised method of moments (GMM) reveal that, while FDI positively and unconditionally spurs economic growth, its growth–enhancing effect is imaginary when the conditional sectoral effects are introduced.
Globalization is a historical process, as it traces back to the 14th century during the origins of civilization. The post-World War II rise of globalization coincided with the post-war roles of these institutions, by forcing them to reform their roles in order to make them relevant to the changing global economic environment.