Kunofiwa Tsaurai

This study examined the influence of financial sector development on FDI inflows in BRICS using panel data (1991–2020) analysis methods. The influence of the complementarity between the financial sector and human capital development on FDI inflows was also examined in the context of BRICS using the same data set and econometric methodologies. The advantage of this study is that the results are used as a basis by BRICS countries to develop financial sector development policies that attract significant FDI inflows. Financial sector development (model 2 and 3 of the pooled ordinary least squares approach) significantly enhanced FDI inflows. Human capital development (model 3 of the fully modified ordinary least squares) was found to have had a significant positive effect on FDI inflows in BRICS group of countries. The combination between financial and human capital development under (1) model 1 of the fully modified ordinary least squares and (2) models 2 and 3 of the pooled ordinary least squares (POLS) was observed to have significantly enhanced FDI inflows in BRICS. The study outlines the financial and human capital development recommendations that need to be implemented to facilitate more FDI inflows.

Acknowledgment
Kunofiwa Tsaurai is grateful for the moral support from his employer, University of South Africa.

This study investigated the effect of FDI on domestic investment in BRICS using pooled ordinary least squares (pooled OLS), fixed effects, and fully modified ordinary least squares (FMOLS). Panel data spanning from 1988 to 2020 were used in this study. Mixed results, conflicting findings and divergent views on the FDI-domestic investment nexus prompted the paper to contribute to the existing literature on the subject. The study produced results that show that domestic investment was significantly enhanced by the inflow of FDI. The positive effect of savings on domestic investment was also noted to be positively significant. Results on personal remittances-domestic investment were mixed, (1) significantly positive under the pooled OLS (models 1, 2 and 3) and FMOLS approaches (model 1) and (2) non-significantly positive under the fixed effects (models 1, 2 and 3) and FMOLS (models 2, 3). The complementarity between savings and FDI had a significant positive influence on domestic investment, whilst the positive impact of a combination of FDI and personal remittances on domestic investment was not significant. BRICS nations are therefore encouraged to implement FDI inflow enhancing measures, strategies and policies to increase individual country’s domestic investment levels.

Acknowledgment
Kunofiwa Tsaurai gratefully acknowledges the moral support from the University of South Africa.

The paper examined the influence of the banking sector on economic growth in the BRICS countries using panel data analysis methods (1987–2020). The effect of the complementarity variable on economic growth in BRICS was also explored using the same data set. The lack of agreement in the empirical literature on the relationship between banking sector development and growth motivated this study. The study was also motivated by the desire to deal away with the omitted variable bias which is to a very large extent plagued the available literature on the influence of the banking sector on economic growth. Panel data analysis included fixed effects (FE), fully modified ordinary least squares (FMOLS), and pooled ordinary least squares (OLS). It was observed that the banking sector had a significant positive effect on economic growth under the pooled OLS (all three models) and fixed effects (model 1). Model 2 under the fixed effects indicate a negative significant relationship moving from the banking sector towards economic growth. FMOLS (models 1 and 2), pooled OLS (models 1, 2 and 3), and fixed effects (model 1) show that the complementarity variable enhanced economic growth significantly. Policies aimed at enhancing banking sector development and domestic investment should be implemented without delay by the BRICS countries if they intend to bolster economic growth.