Article | Open Access | Published: 7 December 2015
Domestic Investment Climate and Foreign Direct Investment in South Asia: A Panel Data Evidence
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Abstract:
The purpose of this paper is to investigate the relation between the governance of a country and its impact on income inequality. The World Bank, Economic Freedom Network, Fraser Institute, and World Economic Forum have been defining and measuring the governance indicators. This study takes six governance indicators to score from -WWGI for the year 2000 and 156 counties data to calculate the correlation between wealth Gini and governance indicators. The statistical analysis is comprised of OLS estimation and Correlation analysis. We found a significant negative relation between governance indicators and wealth inequality, income inequality. Bad governance has a deep impact on the economy of Pakistan. Excessive debt, high fiscal deficit, high inflation, low tax to GDP ratio, high trade deficit, lack of adequate capital formation, and severe energy crisis are some of the economic challenges faces by Pakistan for decades. This study suggests that improvement in governance is not a single-day task, it cannot be achieved at once and it is not related to any department or institution. Its a process that will establish equality, effective management of economic resources.
Keywords:
Domestic Investment Climate, Foreign Direct Investment, South Asia
Publisher:
ILMA UNIVERSITY
Published:
7 December 2015
Issue:
Issue 2 : Volume 11
E-ISSN:
2409-6520
P-ISSN:
2414-8393
This is an open access article distributed under the terms of the Creative Commons Attribution CC BY 4.0 license, which permits any use, distribution, and reproduction of the work without further permission provided the original author(s) and source are credited.