Investment and Economic Growth

The current study intended to investigate the effectof foreign direct investment (FDI) on economicgrowth in Africa and provide an estimate of paneldata on 50 African countries during 1980-2009based on a dynamic panel data estimator (SYSGMM)1 developed by Blundell and Bond (1998).The results of the present study indicated thatforeign direct investment flow had a significanteffect on economic growth in Africa during theresearch period. Furthermore, it found that lowhuman resources did not restrict the effect offoreign direct investment and, subsequently,foreign direct investment had a significantnegative effect on economic growth during 1980-1994 while it had a positive effect during 1995-2009.