Foreign direct investment, income, and environmental pollution in developing countries: Panel data analysis of Latin America

Sapkota, Pratikshya; Bastola, Umesh

doi:10.1016/j.eneco.2017.04.001

Cited by 463 publications

(208 citation statements)

References 44 publications

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“…The impact of foreign direct investment (FDI) on the issues related to environment has been paid more attention both at macro and micro levels. From the macro perspective, it has raised concerns among governments and international community about whether entrance of FDI will deteriorate the ecological environment of host countries [1][2][3][4]. At the microscopic level, the phenomenon of firms attracting FDI regardless of the cost of the environment has attracted broad attention [5].…”

Section: Introductionmentioning

confidence: 99%

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Impact of Foreign Direct Investment on Environmental Performance

Huang

Failler

2019

Sustainability

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The paper presents the results of a study that attempts to investigate the impact of foreign direct investment (FDI) on environmental performance (EP) by constructing a panel quantile regression model. Based on panel data from 1990 to 2014, this study contributes to evaluate the EP of each of the 40 countries using a directional slack-based model considering undesirable output. Our findings reveal several key conclusions: first, FDI has an insignificant influence on EP for the full sample. Second, the impact of FDI on EP between developed and developing countries exists heterogeneity. Furthermore, there is heterogeneity regarding the effect of FDI on EP at different quantiles of EP in developed countries. Specifically, in the developed countries, the effect is statistically insignificant at the lower quantile of EP, then it turns significantly positive at the middle and high quantile, and the positive effect rises with the increase of quantiles of EP. Finally, based on the conclusions of quantitative analysis, some important policy recommendations are proposed: different governments ought to enact different strategies for the introduction of FDI, according to different development situations of different countries.

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Section: Introductionmentioning

confidence: 99%

“…Firstly, previous research has largely focused on the impact of FDI on environment. Existing empirical results of the effect of FDI on environment are controversial [3,[6][7][8]. First and foremost, a body of literature has argued that FDI has a detrimental effect on environment [9].…”

Section: Introductionmentioning

confidence: 99%

Impact of Foreign Direct Investment on Environmental Performance

Huang

Failler

2019

Sustainability

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“…In order to control the impact of other factors on environmental pollution, referring to research of some scholars (Wang et al, 2018; Que et al, 2018; Sapkota and Bastola, 2017; Sghari and Hammami, 2016), industrial structure, fiscal decentralization, foreign direct investment, and local economic development are included in the measurement model as control variables [36][37][38][39]. Adjusted econometric models based on equations (5) and (6) have been established as follows:…”

Section: Methods and Datamentioning

confidence: 99%

Nonlinear Effects of Environmental Regulation on Environmental Pollution

Liu

Neng-sheng

2019

Discrete Dynamics in Nature and Society

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This paper classifies environmental regulation into two types and constructs a theoretical framework to explore the influences of fee-based environmental regulation and invest-based environmental regulation on environmental pollution. It then establishes some dynamic spatial autoregressive nonlinear econometric models to test the theoretical hypothesis based on 30-area panel data from 2004 to 2016. The results illustrate that inverted “U” shape curve relationship exists between fee-based environmental regulation and environmental pollution, while a “U” shape curve relationship between invest-based environmental regulation and environmental pollution exists. In addition, the findings suggest that improving the proportion of secondary industry can directly promote the environmental quality while effectively control of foreign direct investment and fiscal decentralization is also indispensable. Thus, the government should make targeted research about the optimal intensity of fee-based environmental regulation and invest-based environmental regulation and make targeted enterprise policy for the environmental pollution reduce, which contains promoting the energy revolution and strengthening the depth and strength of opening-up step by step.

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“…He illustrated that the Japanese FDI on ASEAN countries do not deteriorate the environmental in host countries. Sapkota and Bastola (2017) reported that FDI has a highly positive significant effect on emission in both high-income and low-income Latin American countries. Related studies regarding PHH are summarized in Table 1.…”

Section: Figure 1 Global Co 2 Emission Of Fossil Fuel Use and Industrmentioning

confidence: 99%

FDI-pollution Nexus: The Role of Corruption

Saini¹,

Tun²

2019

Proceedings of the 2nd Padang International Conference on Education, Economics, Business and Accounting (PICEEBA-2 2018)

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This study aims to re-investigate the Pollution Haven Hypothesis (PHH) by analyzing the role of corruption. We argue that the impact of foreign direct investment (FDI) on pollution in the host country is contingent on the level of corruption of the host country. By using a sample of 70 developing countries, the findings reveal that FDI do not directly influence carbon dioxide (CO2) emission. However, further investigation using threshold regression analysis uncovers that PHH only exist in countries with high level of corruption. In other words, corrupted countries absorb"dirty" FDI and therefore generate more pollution than less corrupted countries.

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Foreign direct investment, income, and environmental pollution in developing countries: Panel data analysis of Latin America

Cited by 463 publications

References 44 publications

Impact of Foreign Direct Investment on Environmental Performance

Impact of Foreign Direct Investment on Environmental Performance

Nonlinear Effects of Environmental Regulation on Environmental Pollution

FDI-pollution Nexus: The Role of Corruption

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