The Effect Of Foreign Direct Investment (FDI) And Export-Import Performance On Economic Growth In G-20 Countries: A Panel Data Analysis

Authors

  • Yusuf Burhanudin Department of Development Economics, Faculty of Economics and Business, Universitas Lampung
  • Yusup Gane Department of Development Economics, Faculty of Economics and Business, Universitas Lampung
  • Leoni Egista Via Department of Development Economics, Faculty of Economics and Business, Universitas Lampung
  • Ainaya Al Fatehah Bacharsya Department of Development Economics, Faculty of Economics and Business, Universitas Lampung
  • Laudya Ramadhani Department of Development Economics, Faculty of Economics and Business, Universitas Lampung
  • Deva Ramadani Department of Development Economics, Faculty of Economics and Business, Universitas Lampung

Keywords:

Economic Growth, Foreign Direct Investment, Trade Openness, Institutional Quality, Panel Data Analysis

Abstract

This study examines the effect of Foreign Direct Investment (FDI) and export-import performance on economic growth in selected G-20 countries using a panel data approach during the period 2000–2024. Economic growth is an important indicator of economic development because it reflects increases in production capacity, national income, and public welfare. In the era of globalization, foreign investment and international trade have become important determinants of economic performance in both developed and developing countries. This study uses panel data analysis by combining cross-sectional data from selected G-20 countries and time-series data from 2000 to 2024. Economic growth is used as the dependent variable, while Foreign Direct Investment (FDI), trade openness, and institutional indicators consisting of Political Stability (PV), Government Effectiveness (GE), Control of Corruption (CC), Voice and Accountability (VA), Regulatory Quality (RQ), and Rule of Law (RL) are used as independent variables. The results indicate that Foreign Direct Investment (FDI) has a positive and significant effect on economic growth. In addition, institutional quality represented by Control of Corruption (CC) also shows a significant influence on economic performance. Meanwhile, several trade-related variables show varying effects on economic growth. Simultaneously, foreign investment, trade openness, and institutional quality significantly influence economic growth in selected G-20 countries. These findings imply that governments need to strengthen institutional quality, improve investment climates, and formulate effective international trade policies to support sustainable economic growth.

References

Baltagi, B. H. (2005). Econometric analysis of panel data (3rd ed.). John Wiley & Sons.

Dunning, J. H. (1988). The eclectic paradigm of international production: A restatement and some possible extensions. Journal of International Business Studies, 19(1), 1–31. https://doi.org/10.1057/palgrave.jibs.8490372

Gujarati, D. N., & Porter, D. C. (2009). Basic econometrics (5th ed.). McGraw-Hill Education.

Kurniawati, E., et al. (2021). Institutional quality and economic growth. Journal of Public Auditing and Financial Management. https://doi.org/10.36407/jpafm.v1i1.304

North, D. C. (1990). Institutions, institutional change and economic performance. Cambridge University Press.

Prasetyo, P. E., et al. (2022). International trade and economic growth relationship. Jurnal Ekonomi Pembangunan. https://journals2.ums.ac.id/jep/article/view/8822

Rahman, A., et al. (2021). Export-import activities and economic development. Review of Economic and Business Studies. https://journal.untidar.ac.id/index.php/rep/article/view/3050/1383

Ricardo, D. (1817). On the principles of political economy and taxation. John Murray.

Solow, R. M. (1956). A contribution to the theory of economic growth. The Quarterly Journal of Economics, 70(1), 65–94. https://doi.org/10.2307/1884513

Stanišić, N. (2016). The effects of foreign direct investment and trade openness on economic growth. Economic Research-Ekonomska Istraživanja, 29(1), 293–305. https://doi.org/10.1080/1331677X.2016.1164922

World Bank. (2026). World Development Indicators. https://data.worldbank.org

World Bank. (2026). Worldwide Governance Indicators. https://info.worldbank.org/governance/wgi/

Ahmad, M., & Nayan, S. (2019). Income inequality and middle-income trap: A panel data analysis on the effects of economic freedom and democracy. International Journal of Business and Society, 20(2), 563-584.

Ananta, P., Kamal, M. E. M., & Mohamed, N. (2023). Public spending, corruption, and human development: Empirical evidence in middle-income countries. European Proceedings of Social and Behavioural Sciences, 562-579.https://doi.org/10.15405/epsbs.2023.11.48

Downloads

Published

2026-06-17

How to Cite

Burhanudin, Y., Gane, Y. ., Via, L. E. ., Bacharsya, A. A. F. ., Ramadhani, L. ., & Ramadani, D. . (2026). The Effect Of Foreign Direct Investment (FDI) And Export-Import Performance On Economic Growth In G-20 Countries: A Panel Data Analysis. DAS CONFERENCE INTERNATIONAL SERIES, 4, 72–77. Retrieved from https://journal.das-institute.com/index.php/proceeding/article/view/1406

Issue

Vol. 4 (2026): Proceeding International Conference on Global Economic Dynamics

Section

Articles Proceeding

License

Copyright (c) 2026 Yusuf Burhanudin, Yusup Gane, Leoni Egista Via, Ainaya Al Fatehah Bacharsya, Laudya Ramadhani, Deva Ramadani

Creative Commons License

This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.