Standard Gravity Inversion Modeling FDI Per Capita GDP in the Ethiopian economy Environment from 1998 to 2017

ALI GABOUSSA (PhD, Faculty of Economic and Commercial Sciences and Management Sciences in El-oued. (Algeria))
Wafa Ramdani (PhD student, Faculty of Economic and Commercial Sciences and Management Sciences in El-oued. (Algeria))
Hayat Otmani (PhD student, Faculty of Economic and Commercial Sciences and Management Sciences in El-oued. (Algeria))
Salim Keffane (PhD in, Department of Psychology, University Setif 2, Setif, Algeria)

Abstract


The reality of FDI in the Ethiopian economy environment as well as the standard and analytical modeling of the reflection of this type of investment on the economic growth during the period (1998-2017) based on the hypothesis that the policy of attracting foreign investments in the Ethiopian economy has a positive effect in general And per capita GDP in particular. The analytical and standard study concluded with a number of results, including: (1) The Ethiopian economy's qualitative leap coincided with the entry of foreign direct investment into Ethiopia until Ethiopia reached Africa's fastest growing economy in return for the second most attractive country for foreign investment in the world after Angola in 2016. (2) The strength of foreign direct investment (FDI) has been reflected in the size of the GDP, but it has not been reflected in the level required for the welfare of the Ethiopian individual. (3) The standard study indicates that there is a direct correlation between FDI and GDP per capita, meaning that any increase in the volume of FDI in the Ethiopian economy will lead to an increase in per capita GDP.


Keywords


Foreign direct investment; Economic growth; Ethiopian economy

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DOI: https://doi.org/10.30564/jbar.v2i3.666

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