By using provincial socioeconomic and environmental data, this paper examines the relationship between human capital, FDI and pollution emissions in China. The result shows the impact of FDI on pollution emission is highly dependent on the level of human capital. FDI is negatively associated with pollution emissions in provinces with the higher levels of human capital, whereas FDI is positively related to pollution emissions in provinces with the lower levels of human capital. This suggests that pollution haven hypothesis (PHH) holds only in those provinces with low human capital. This study also finds that the sign of FDI's effect on each pollutant' emission requires the different threshold level of human capital, which may help to reconcile the current conflicting PHH empirical evidences partially.
The recent trend of product diversification in the Indonesian banking industry underscores the importance of non-interest income activities. This study examines the relationship between product diversification and bank risk over the period of 2002-2008. Our analysis shows clear evidence that the effect of product diversification on bank risk depends highly on the bank's asset size. Specifically, the degree of product diversification is negatively associated with bank risk for small-sized banks. Conversely, the degree of product diversification is positively related to bank risk for large-sized banks. This finding suggests that deregulation encouraging banks to become more involved in non-traditional activities may have an adverse effect on the overall banking system where large-sized banks are playing a significant role in Indonesia.
KUT-SDE working papers are preliminary research documents published by the School of Economics and Management jointly with the Research Center for Social Design Engineering at Kochi University of Technology. To facilitate prompt distribution, they have not been formally reviewed and edited. They are circulated in order to stimulate discussion and critical comment and may be revised. The views and interpretations expressed in these papers are those of the author(s). It is expected that most working papers will be published in some other form.
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