FDI, Good Governance and Economic Growth

Variable Definition/Description Expected Sign Source Economic Growth Annual percentage growth rate of per capita real domestic product for country i at time t +/- WDI/WB FD1 Foreign Direct Investment inflows as percentage of GDP for country i at time t. + UNCTAD Openness to trade Openness – the sum of export and import value as percentage of GDP for country i at time t + WDI/WB Financial Development Domestic credit to private sector development (% of GDP)   World Bank, African Development indicators Market size Log of GDP   World Development indicators Wealth of the population Log of GDP per capita   World Development indicators Governance score A composite index of safety and rule of law, participation and human right, sustainable economic opportunity and human Development   Mo Ibrahim Index of Africa Governance.

Macroeconomic stability GDP Deflator - IMF Exchange rate Real effective exchange rate +/- World Development indicators Ease of doing business Composite index of starting a business, dealing with licenses, employing workers, registering property, getting credit, protecting investor, paying taxes, trading across borders, enforcing contracts, and closing a business.  + World Bank Data Exchange Rate Real Effective exchange Rate - WDI