Forecasting Foreign Direct Investment Inflow in Jordan: Univariate ARIMA Model
Al-Abdulrazag Bashier and Bataineh Talal
DOI : 10.3844/jssp.2007.1.6
Journal of Social Sciences
Volume 3, Issue 1
The present study is an attempt to build a Univariate time series model to forecast the FDI inflows into Jordan over the coming period 2004-2025. The study employs Box-Jenkins methodology of building ARIMA (Autoregressive Integrated Moving Average) model to achieve the goals of the study. An annual sample time series data for the FDI in Jordan was utilized over the period 1976-2003. The data were collected from the Central Bank of Jordan publications. The accuracy of the selected models was tested by performing different diagnostic tests to ensure the accuracy of the obtained results. Results of the study show that ARIMA model provides a better model for forecasting FDI in Jordan. The empirical results of ARIMA model have shown that FDI is following an increasing trend over the forecasted period (2004-2025). The empirical results indicate the expected positive impact of FDI inflows on different macroeconomic variables in Jordan economy.
© 2007 Al-Abdulrazag Bashier and Bataineh Talal. This is an open access article distributed under the terms of the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.