Relationship between Foreign Direct Investment and GDP growth of Vietnam

THESIS RESEARCH
DESIGN

Contents
THE PROBLEM STATEMENT.....................................................................................................1
Background of the investigation..................................................................................................1
Rationale of investigation............................................................................................................1
RESEARCH OBJECTIVES AND/OR RESEARCH QUESTION.................................................2
Research Aim...............................................................................................................................2
Research objectives.....................................................................................................................2
Research questions.......................................................................................................................2
LITERATURE REVIEW................................................................................................................2
To analyse the concept of Foreign Direct Investment in Vietnam..............................................2
To analyse the concept of Gross development product in Vietnam............................................3
To identify the impact of FDI on nation’s GDP to assess the relationship between FDI and
economic growth of Vietnam......................................................................................................4
To evaluate various models, approaches or theories for the relationship of FDI and GDP........4
METHODOLOGY..........................................................................................................................5
Analytical framework..................................................................................................................5
Empirical model...........................................................................................................................6
Hypotheses...................................................................................................................................6
Estimation methods.....................................................................................................................7
Data requirements........................................................................................................................7
Data collection method................................................................................................................7
SCHEDULE....................................................................................................................................7
REFERENCES................................................................................................................................9

THE PROBLEM STATEMENT
“Identifying the relationship between Foreign Direct Investment and GDP growth of
Vietnam”
Background of the investigation
Foreign direct investment is a kind of investment which is made by an organisation or
individual of a country to another country’s businesses. This concept has a wider scope as it
helps in acquiring the foreign business assets. The restriction of this concept is that it cannot be
done in closed economies and these nations does not allow foreign investments. Typically, FDI
is considered as capital investments as it involves high amount of monetary value. FDI provides
privilege to its investors to effectively control the decision making of the foreign business.
The concept of foreign direct investment is considered to be related with economic growth
of a nation. Economic growth is considered as the overall enhanced in inflation adjusted market
value of commodities produced by a nation (Moran, 2012) (Thanh and Duong, 2011). The
universal measure to analyse the level of economic growth is GDP. Gross domestic product is a
monetary measure which helps in computing the market value of the final commodities produced
by an economy. It is considered that the concepts of FDI and GDP are inter-related as FDI helps
in improving the GDP of a nation. This hypothesis of relationship between two variables is
evidently investigated in this thesis.
Vietnam is an Asian country which is considered as one of the most fastest growing
economies in the world. The foreign direct investment and gross domestic product of this
country is investigated through this thesis in order to analyse the relationship between them.
Rationale of investigation
The rationale behind conducting this investigation is to analyse the impact of foreign direct
investigation upon the enhancement of GDP or economic growth of Vietnam. This investigation
will help in analyse the level which impacts which external factors such as FDI can have upon
the economic growth of a region. Another reason behind conducting this research is to develop
an understanding about the techniques of econometrics. Along with this, secondary data is
intended to be analysed using various statistical methods.
The problem statement which this investigation attempts to address is the relationship
between foreign direct investment and gross domestic product in Vietnam. This problem
1