Abstract
This study investigates the relationship among foreign direct investment, energy use, human capital, and economic growth for Malaysia and Thailand over a period 1975 to 2021. The ARDL bounds test for Malaysia and Thailand confirmed the co-integration between variables in the long-run. The long-run ARDL results corroborate that energy consumption, human capital, and financial development promote economic growth. Accordingly, the study supported the FDI-led growth hypothesis. The study observed a long-run bidirectional causality between energy consumption and economic growth and concludes that an energy policy that is oriented toward improvements in energy consumption efficiency may not adversely affect the real GDP. In the case of Thailand, the study detected four bidirectional causality relationships among the variables. Empirical findings verify that appropriate public policy must be formulated to stimulate inward FDI, human capital, trade, financial development, and energy to foster economic growth and development both in Malaysia and Thailand.