The Interactive Effect Of Foreign Direct Investment And The Informal Sector On Economic Growth In Algeria Amid Structural Breaks: An Econometric Analysis Using The Ardl Model, 1995–2025
Auteurs : Hansal Aboubakr .
Résumé
This study analyzes the interactive effect of Foreign Direct Investment (FDI) and the informal sector on economic growth in Algeria (1995–2025) using an Autoregressive Distributed Lag (ARDL) bounds testing approach alongside marginal effect analysis and diagnostic tests. The empirical findings confirm a long-run cointegration relationship, showing a negative main effect for FDI and a positive main effect for the informal sector. However, the interaction term is statistically significant and positive, demonstrating that the impact of FDI is conditioned by the scale of informal economic activity. Specifically, the estimated threshold is approximately 28.56%, beyond which the marginal effect of FDI shifts from negative to positive. Robustness tests confirm the stability of these dynamics, highlighting the necessity of accounting for the informal sector when assessing FDI impacts in Algeria.
Mots clés
Foreign Direct Investment; Informal sector; Economic growth; Interactive effect; Marginal effect.
