Role of Stock Market Performance and Exchange Rate Volatility in the Inflow of Foreign Direct Investment: An Evidence from Pakistan
The purpose of this study was to evaluate the role of macroeconomic variables i.e., stock market performance and exchange rate fluctuations on Foreign Direct Investment (FDI) for Pakistan. The required data was collected for the period of 1996 to 2020 from the World Bank and State Bank of Pakistan....
Saved in:
| Main Authors: | , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
International Research Alliance for Sustainable Development - iRASD
2022-03-01
|
| Series: | iRASD Journal of Management |
| Subjects: | |
| Online Access: | https://www.journals.internationalrasd.org/index.php/jom/article/view/693 |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| _version_ | 1850218084954013696 |
|---|---|
| author | Rukhsana Rasheed Mazhar Nadeem Ishaq Muhammad Fahad Malik |
| author_facet | Rukhsana Rasheed Mazhar Nadeem Ishaq Muhammad Fahad Malik |
| author_sort | Rukhsana Rasheed |
| collection | DOAJ |
| description |
The purpose of this study was to evaluate the role of macroeconomic variables i.e., stock market performance and exchange rate fluctuations on Foreign Direct Investment (FDI) for Pakistan. The required data was collected for the period of 1996 to 2020 from the World Bank and State Bank of Pakistan. In data analysis, the unit-root tests were performed to decide whether a time-series is stationary or not. An ARDL is constructed to achieve the results of this study. The results of this study provided the evidences that stock market performance and trade openness have positively and significantly linked with FDI. Whereas real GDP growth rate and exchange rates have negative effects on FDI. It is recommended that the trade policies should be devised in such a manner that these policies should promote exports. Furthermore, policies that ensure stable stock market performance could be an important factor for bringing FDI to Pakistan. However, FDI seems to be ineffective from the changes in the rate of inflation.
|
| format | Article |
| id | doaj-art-6ec320c5a3a74d0eae7f2ed2d8be5d7a |
| institution | OA Journals |
| issn | 2709-8443 2709-8451 |
| language | English |
| publishDate | 2022-03-01 |
| publisher | International Research Alliance for Sustainable Development - iRASD |
| record_format | Article |
| series | iRASD Journal of Management |
| spelling | doaj-art-6ec320c5a3a74d0eae7f2ed2d8be5d7a2025-08-20T02:07:53ZengInternational Research Alliance for Sustainable Development - iRASDiRASD Journal of Management2709-84432709-84512022-03-014110.52131/jom.2022.0401.0063Role of Stock Market Performance and Exchange Rate Volatility in the Inflow of Foreign Direct Investment: An Evidence from PakistanRukhsana RasheedMazhar Nadeem Ishaq0Muhammad Fahad Malik1The Islamia University of Bahawalpur, PakistanThe Islamia University of Bahawalpur, Pakistan The purpose of this study was to evaluate the role of macroeconomic variables i.e., stock market performance and exchange rate fluctuations on Foreign Direct Investment (FDI) for Pakistan. The required data was collected for the period of 1996 to 2020 from the World Bank and State Bank of Pakistan. In data analysis, the unit-root tests were performed to decide whether a time-series is stationary or not. An ARDL is constructed to achieve the results of this study. The results of this study provided the evidences that stock market performance and trade openness have positively and significantly linked with FDI. Whereas real GDP growth rate and exchange rates have negative effects on FDI. It is recommended that the trade policies should be devised in such a manner that these policies should promote exports. Furthermore, policies that ensure stable stock market performance could be an important factor for bringing FDI to Pakistan. However, FDI seems to be ineffective from the changes in the rate of inflation. https://www.journals.internationalrasd.org/index.php/jom/article/view/693Stock MarketExchange RateForeign Direct InvestmentCost of EquityPakistan |
| spellingShingle | Rukhsana Rasheed Mazhar Nadeem Ishaq Muhammad Fahad Malik Role of Stock Market Performance and Exchange Rate Volatility in the Inflow of Foreign Direct Investment: An Evidence from Pakistan iRASD Journal of Management Stock Market Exchange Rate Foreign Direct Investment Cost of Equity Pakistan |
| title | Role of Stock Market Performance and Exchange Rate Volatility in the Inflow of Foreign Direct Investment: An Evidence from Pakistan |
| title_full | Role of Stock Market Performance and Exchange Rate Volatility in the Inflow of Foreign Direct Investment: An Evidence from Pakistan |
| title_fullStr | Role of Stock Market Performance and Exchange Rate Volatility in the Inflow of Foreign Direct Investment: An Evidence from Pakistan |
| title_full_unstemmed | Role of Stock Market Performance and Exchange Rate Volatility in the Inflow of Foreign Direct Investment: An Evidence from Pakistan |
| title_short | Role of Stock Market Performance and Exchange Rate Volatility in the Inflow of Foreign Direct Investment: An Evidence from Pakistan |
| title_sort | role of stock market performance and exchange rate volatility in the inflow of foreign direct investment an evidence from pakistan |
| topic | Stock Market Exchange Rate Foreign Direct Investment Cost of Equity Pakistan |
| url | https://www.journals.internationalrasd.org/index.php/jom/article/view/693 |
| work_keys_str_mv | AT rukhsanarasheed roleofstockmarketperformanceandexchangeratevolatilityintheinflowofforeigndirectinvestmentanevidencefrompakistan AT mazharnadeemishaq roleofstockmarketperformanceandexchangeratevolatilityintheinflowofforeigndirectinvestmentanevidencefrompakistan AT muhammadfahadmalik roleofstockmarketperformanceandexchangeratevolatilityintheinflowofforeigndirectinvestmentanevidencefrompakistan |