Title :
The relationship between FDI and foreign exchange reserve and its underlying causes
Author :
Huang, Yanjun ; Qian, Liangying ; Zhong, Lu
Author_Institution :
Coll. of Econ., Zhejiang Univ., Hangzhou, China
Abstract :
This paper applies Co integration analysis and Granger causality test to obtain the relationship between FDI and foreign exchange reserve, using the annual data from 1982 to 2008. The empirical result indicates that there exists a long run equilibrium tendency and significant bi-directional Granger causality between China´ FER and its FDI. With further analysis, we know that a capital flow collateral relationship and financing mechanisms of U.S. current account exist between China and America.
Keywords :
foreign exchange trading; international finance; America; China FER; FDI; U.S. current account; bidirectional Granger causality; capital flow collateral relationship; cointegration analysis; financing mechanisms; foreign exchange reserve; long run equilibrium tendency; Correlation; Economics; Finance; Instruments; Investments; Silicon carbide; Time series analysis; FDI; capital flow collateral relationship; foreign exchange reserve;
Conference_Titel :
Computer Science and Service System (CSSS), 2011 International Conference on
Conference_Location :
Nanjing
Print_ISBN :
978-1-4244-9762-1
DOI :
10.1109/CSSS.2011.5975054
