Investigating the Dynamic Impact of FDI Inflows and Economic Growth on Environmental Degradation
Evidence From FMOLS and Dols for Selected Asian Countries
Bibliographic Data
| ID | 6152002 |
|---|---|
| Authors | Hamad Khan (0000-0002-7841-3425, Universiti Sains Malaysia), Siti Rahyla Rahmat (0000-0002-6121-7604, Universiti Sains Malaysia) |
| Year | 2021 |
| Volume | 16 |
| Issue | 3 |
| Pages | 183-202 |
| Publication date | 2021-10-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | International Organisations Research Journal (JOURNAL) |
| Journal identifiers | ISSN: 1996-7845 • E-ISSN: 2542-2081 |
| Publisher | National Research University, Higher School of Economics (HSE) (PUBLISHER) |
| DOI | 10.17323/1996-7845-2021-03-08 |
| OpenAlex | W3212053676 |
| Language | EN |
| References cited | 25 |
The study examines the dynamic relationship between foreign direct investment (FDI) inflows, economic growth, and environmental degradation and investigates the long-run validity of the environmental Kuznets curve (EKC) and the pollution haven hypothesis (PHH) for selected Asian countries over the period 1990–2019. Additionally, this study aims to discover the longrun impact of energy consumption, globalization, and population density on environmental degradation by employing a panel cointegration approach, fully modified ordinary least squares (FMOLS), and dynamic ordinary least squares (DOLS). The findings provide clear evidence of the existence of EKC and PHH in Asian countries for the period 1990–2019 in the long run. The findings reveal that economic growth has a highly significant and positive role in depleting environmental quality, but this effect gets reversed in the long run as, after a certain turning point, economic growth increases, and the quality of the environment gets better. Moreover, FDI inflows and energy consumption have a positive long-run impact on CO2 emissions, thus contributing to environmental degradation. The study recommends that governments and policymakers should strategically devise and implement CO2 reduction policies, such as carbon pricing, to encourage economic growth and to improve the quality of the environment, with the ultimate goal being to achieve sustainable development. Moreover, the use of cleaner energy should be promoted, and innovations and technological developments should be encouraged for hydropower, wind power, solar energy and other facilities around the world
Cointegration · Development economics · Econometrics · Economic growth · Economics · Energy consumption · Environmental degradation · Environmental pollution · Environmental protection · Environmental quality · Foreign direct investment · Hydropower · Kuznets Curve · Macroeconomics · Ordinary least squares · Pollution haven hypothesis · Energy, Environment, and Transportation Policies · Energy, Environment, Economic Growth · Engineering · Environmental Science · Environmental Sustainability in Business
Critical Values for Cointegration Tests in Heterogeneous Panels with Multiple Regressors
Environmental Kuznets Curve in China
The local power of some unit root tests for panel data
Is There an Environmental Kuznets Curve for Sulfur?
Unit root tests for panel data
Investigating the environmental Kuznets curve hypothesis in Vietnam
On the estimation and inference of a cointegrated regression in panel data
Environmental Quality and Development
Greenhouse gas emissions, energy consumption and economic growth
The impact of growth, energy and financial development on the environment in China
The Environmental Kuznets Curve (EKC) theory—Part A
Carbon dioxide emissions and economic growth
North-South Trade and the Environment
Foreign direct investment, income, and environmental pollution in developing countries
Economic growth and CO2 emissions in Malaysia
Investigation of the environmental Kuznets curve for carbon emissions in Malaysia
Unit root tests in panel data
Environmental Impacts of a North American Free Trade Agreement
Testing for unit roots in heterogeneous panels
Panel Cointegration
Spurious regression and residual-based tests for cointegration in panel data
Carbon Pricing
Environmental Kuznets Curve Hypothesis
The KOF Globalisation Index – revisited
Moving to greener pastures? Multinationals and the pollution haven hypothesis
| Citation velocity | historical |
|---|---|
| Highly cited | No |