Effects of ICT hardware, software and FDI on CO2 emissions in China

Abstract

With the rapid development of information and communication technology (ICT) and counter-cyclical expanding of foreign direct investment (FDI), most foreign-invested companies in China are highly polluting. Meanwhile, new research shows that the impact of ICT on the environment is uncertain. This study is an effort in dividing ICT into hardware and software, aiming to explore its effects on CO2 emissions from 2003 to 2017 in 31 provinces, autonomous regions and municipalities in China, and further explore the impacts of its application to foreign-invested enterprises on environmental quality. The findings show that ICT software specifies negative and statistically significant effects on CO2 emissions, but ICT hardware and FDI indicate positive and statistically significant effects on CO2 emissions. However, when ICT software and hardware are applied to foreign-invested enterprises, they can significantly improve the environmental quality. It is noteworthy that previous period of ICT software will increase current CO2 emissions significantly, yet ICT hardware lagged three years will reduce current CO2 emissions significantly.

Digital Technologies, Environmental Governance and Environmental Performance: Empirical Evidence from China

“…The findings showed that institutional quality and ICT had negative impact on carbon emission. For China, (Chi & Meng, 2022) explored the effect of ICT on CO2 emission in different provinces and municipalities and concluded that ICT reduced CO2 emission in System GMM estimation. (Kongbuamai et al, 2022) studied the nexus between ICT and ecological footprints in N-11 countries by applying Feasible Generalized Least Squares and Driscoll-Kraay standard errors and found that ICT had positive association with ecological footprints in N-11 countries.…”