Amadou Maiga Ousseini¹, Xiaojuan Hu¹, Badamassi Aboubacar²

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¹ School of Economics and Trade, Hunan University, Changsha, China.
² School of Economics and Management, China University of Geosciences, Wuhan, China.
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Abstract: Capital inflow is an important factor for a country’s economy. In this paper our main purpose is to investigate or to assess if the capital from abroad has a significant impact on economic growth in Niger. Our analysis takes data from 1980 to 2012 into consideration by using system equation method or the concept of cointegration and the vector error correction Model of GDP Growth Rate (GDPGR), Development Assistance (DASSIS), Foreign Direct Investment (FDI), Migrants’ Remittance (MIGREMIT), Real Exchange Rate (REEXR) and Domestic Investment (DOMINV). We pay a particular attention on the impact of Development Assistance, Foreign Direct Investment, and Migrants’ Remittance. The result of analysis shows an insignificant impact of Development Assistance (DASSIS), Foreign Direct Investment (FDI), on the growth in contrast with our expectation. Migrants’ Remittance on his side has a significant relation on GDP performance.

Keywords: GDP Growth, Foreign Capital Flow, Time Series, System Equation, Niger

Cite this paper: Ousseini, A. , Hu, X. and Aboubacar, B. (2015) Foreign Capital Flow in Niger: An Assessment of Impact Using System Equation Method. Theoretical Economics Letters, 5, 509-521. doi: 10.4236/tel.2015.54060.

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