Economic Impact Of FDI In China And Indonesia

This research is made to see the economic impact of FDI to economic growth, as well as the impact of other controlling variables such as education, inflation, and labor force to economic growth. The foreign direct investment used is foreign direct investment inflow for every country, using data from World Bank Indicator for the time period from 1990 to 2013. The research would like to see the result for two countries; Indonesia and China. The hypothesis examination is done using Ordinary Least Square Single Linear Regression, with classical assumption test. There are 24 years of observation in two countries (China and Indonesia). The result of the research has shown that there are different result of economic impact of foreign direct investment to economic growth in China and Indonesia. There are a significant and positive relation between Foreign Direct Investment and economic growth in Indonesia, but there is no significant relation between foreign direct investment and economic growth in China.