Impact of road transport on foreign direct investment and economic growth: Empirical evidence from simultaneous equations model

Abstract

The aim of this article is to analyze the impact of road transport on the economic growth through its participation in the attractiveness of the foreign direct investment to Tunisia over the period between 1975 and 2014. The generalized method of moments was used to estimate a simultaneous equations model containing a growth equation and a foreign direct investment equation. The obtained results indicate that the roads promote the entry of the foreign direct investment by consequence the economic growth in the long term