Impact of Foreign Direct Investment, Inflation and Export on Gross Domestic Product of SAARC Countries

Abstract

The study investigates the influence of FDI,CPI & export on GDP of SAARC countries over the periods of 2008-2017.Linear pooled OLS estimator, Fixed effect model & Random effect model has been used to explore the relationship how the macroeconomic factors effect on GDP of SAARC countries. Hausman test has been performed to see whether Fixed of random model is appropriate for the study and Hausman test indicates that random model is appropriate for the study.VIF test has been done to check the multicollinearity& it indicates that there is no presence of multicollinearity among the variables. To conduct the study, we have considered Real GDP as dependent variable and FDI,CPI& Export as independent variables. FDI & Export have a positive and but statistically insignificant impact on Real GDP of SAARC countries has a positive statistically impact on Real GDP of SAARC region countries.