The paper examines the effect of foreign capital inflow on growth of output, domestic saving, imports and production structure. In doing so, a simultaneous equation model for the Bangladesh economy in the framework of the dual gap analysis has been estimated using the time series data for the...

The article tests the following hypotheses in the context of Bangladesh economy: (1) The level of the economy is constrained, at least in part, by the foreign exchange availability. (2) Different components of foreign exchange may differ in their impacts on the three categories of imports. (3)...

On the basis of theoretical and empirical studies, it can be suggested that foreign capital inflow may have either a positive or a negative effect on domestic savings. The author shows in this contribution a positive effect of foreign capital inflow on domestic saving in the case of Bangladesh....