Could foreign direct investment increase unemployment: case of KSA.

Said Jaouadi


The aim of the paper is to shed the light on the effect of foreign direct investment on unemployment of host countries. The empirical investigation relied on finding out the essence of the expectations underlined in the theoretical background. In economic literature, authors assumed that FDI has positive impacts on developing countries hosting such investments.

The present survey attempted to determine the principal foundations of the relationship between FDI and unemployment in short and in long run. The empirical research focused on the cointegration approach in econometrics.

The empirical survey underlined the harmful impact of FDI on unemployment in KSA in short and long-term, due to the inefficiency of the Saudi labor market that remains particular compared with other developing countries.


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