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Foreign direct investment and its impact on CO2 emissions at various levels of economic development

Foreign direct investment (FDI) may have a negative impact on carbon dioxide (CO2) emissions through imported technologies that cause air pollution. However, previous studies presented inconclusive results on the impact of FDI on CO2 emissions. This indicates the possibility of other factors or diff...

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Main Authors: Abdullahi, Abubakar, Ibrahim, Saifuzzaman, W.N.W, Azman-Saini, Law, Siong Hook
Format: Article
Published: UPM Press 2023
Online Access:http://psasir.upm.edu.my/id/eprint/108043/
http://www.ijem.upm.edu.my/vol17no3.htm
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spelling my.upm.eprints.1080432024-09-26T04:12:56Z http://psasir.upm.edu.my/id/eprint/108043/ Foreign direct investment and its impact on CO2 emissions at various levels of economic development Abdullahi, Abubakar Ibrahim, Saifuzzaman W.N.W, Azman-Saini Law, Siong Hook Foreign direct investment (FDI) may have a negative impact on carbon dioxide (CO2) emissions through imported technologies that cause air pollution. However, previous studies presented inconclusive results on the impact of FDI on CO2 emissions. This indicates the possibility of other factors or different economic conditions that can explain the observed contradicting impacts of FDI on CO2 emissions. This study examines the impact of FDI on CO2 emissions at various levels of economic development. In a sample of 123 countries, results from the bias-corrected least-squares dummy variable (LSDVC) technique show that FDI asymmetrically affects CO2 emissions. The presence of FDI lowers CO2 emissions in countries with higher incomes and raises carbon emissions in countries with lower incomes. This finding also suggests that FDI inflows introduce greener technologies in high and middle-income countries. Meanwhile, dirty FDI flows into low-income countries and adversely affects the environment. UPM Press 2023 Article PeerReviewed Abdullahi, Abubakar and Ibrahim, Saifuzzaman and W.N.W, Azman-Saini and Law, Siong Hook (2023) Foreign direct investment and its impact on CO2 emissions at various levels of economic development. International Journal of Economics and Management, 17 (3). 293 -303. ISSN 1823-836X; ESSN: 2600-9390 http://www.ijem.upm.edu.my/vol17no3.htm 10.47836/ijeam.17.3.01
institution Universiti Putra Malaysia
building UPM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Putra Malaysia
content_source UPM Institutional Repository
url_provider http://psasir.upm.edu.my/
description Foreign direct investment (FDI) may have a negative impact on carbon dioxide (CO2) emissions through imported technologies that cause air pollution. However, previous studies presented inconclusive results on the impact of FDI on CO2 emissions. This indicates the possibility of other factors or different economic conditions that can explain the observed contradicting impacts of FDI on CO2 emissions. This study examines the impact of FDI on CO2 emissions at various levels of economic development. In a sample of 123 countries, results from the bias-corrected least-squares dummy variable (LSDVC) technique show that FDI asymmetrically affects CO2 emissions. The presence of FDI lowers CO2 emissions in countries with higher incomes and raises carbon emissions in countries with lower incomes. This finding also suggests that FDI inflows introduce greener technologies in high and middle-income countries. Meanwhile, dirty FDI flows into low-income countries and adversely affects the environment.
format Article
author Abdullahi, Abubakar
Ibrahim, Saifuzzaman
W.N.W, Azman-Saini
Law, Siong Hook
spellingShingle Abdullahi, Abubakar
Ibrahim, Saifuzzaman
W.N.W, Azman-Saini
Law, Siong Hook
Foreign direct investment and its impact on CO2 emissions at various levels of economic development
author_facet Abdullahi, Abubakar
Ibrahim, Saifuzzaman
W.N.W, Azman-Saini
Law, Siong Hook
author_sort Abdullahi, Abubakar
title Foreign direct investment and its impact on CO2 emissions at various levels of economic development
title_short Foreign direct investment and its impact on CO2 emissions at various levels of economic development
title_full Foreign direct investment and its impact on CO2 emissions at various levels of economic development
title_fullStr Foreign direct investment and its impact on CO2 emissions at various levels of economic development
title_full_unstemmed Foreign direct investment and its impact on CO2 emissions at various levels of economic development
title_sort foreign direct investment and its impact on co2 emissions at various levels of economic development
publisher UPM Press
publishDate 2023
url http://psasir.upm.edu.my/id/eprint/108043/
http://www.ijem.upm.edu.my/vol17no3.htm
_version_ 1811685982552981504
score 13.211869

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