Do Developing Countries Invest Up? The Environmental Effects of Foreign Direct Investment from Less-Developed Countries

Zeng, Ka; Eastin, Joshua

doi:10.1016/j.worlddev.2012.03.008

Cited by 101 publications

(49 citation statements)

References 48 publications

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“…It is believed that foreign companies use better management practices and advanced technologies that are conducive to a clean environment in host countries (Zarsky, 1999), which is known as the halo effect hypothesis. Similarly, Zeng and Eastin (2012) find that overall FDI inflows in less-developing countries promote better environmental awareness.…”

Section: Introductionmentioning

confidence: 92%

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The effects of FDI, economic growth and energy consumption on carbon emissions in ASEAN-5: Evidence from panel quantile regression

et al. 2016

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This study investigates the impact of foreign direct investment (FDI), economic growth and energy consumption on carbon emissions in five selected member countries in the Association of South East Asian Nations (ASEAN-5), including Indonesia, Malaysia, the Philippines, Singapore and Thailand. This paper employs a panel quantile regression model that takes unobserved individual heterogeneity and distributional heterogeneity into consideration. Moreover, to avoid an omitted variable bias, certain related control variables are included in our model. Our empirical results show that the effect of the independent variables on carbon emissions is heterogeneous across quantiles.Specifically, the effect of FDI on carbon emissions is negative, except at the 5th quantile, and becomes significant at higher quantiles. Energy consumption increases carbon emissions, with the strongest effects occurring at higher quantiles. Among the high-emissions countries, greater economic growth and population size appear to reduce emissions. The results of the study also support the validity of the halo effect hypothesis in higher-emissions countries. However, we find little evidence in support of an inverted U-shaped curve in the ASEAN-5 countries. In addition, a higher level of trade openness can mitigate the increase in carbon emissions, especially in low-and high-emissions nations. Finally, the results of the study also provide policymakers with important policy recommendations.

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Section: Introductionmentioning

confidence: 92%

“…Indeed, the rising FDI flow in developing countries raises an important question regarding whether it has any environmental consequence (Zeng and Eastin 2012).…”

Section: Introductionmentioning

confidence: 99%

The effects of FDI, economic growth and energy consumption on carbon emissions in ASEAN-5: Evidence from panel quantile regression

et al. 2016

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“…The recent numbers showed clearly that in the past two decades, foreign direct investment in developing countries has increased, especially in middle and low income countries. While foreign direct investment in high-income countries, is more likely to take advantage of assets such as technologies and intellectual property (Zeng and Eastin, 2012). The contemporary situation is a challenging one for global foreign direct investment.…”

Section: Introductionmentioning

confidence: 99%

Does foreign direct investment impede environmental quality in high-, middle-, and low-income countries?

et al. 2015

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“…Secondly, the percentage of the amount of foreign direct investment in regional GDP (Fdi) is used to control the impacts of the differences in degrees of openness and market orientation on environmental pollution. Foreign direct investment produces some impacts on the environmental pollution of developing countries [47]. In order to attract foreign companies and capital, local officials lower environmental standards, which may, as GDP rises, aggravate environmental pollution.…”

Section: Model and Variablesmentioning

confidence: 99%

How Have Political Incentives for Local Officials Reduced Environmental Pollution in Resource-Depleted Cities?

et al. 2017

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Chinese resource-exhausted cities face more severe environmental pollution problems than other cities. In addressing these problems, the way local officials (usually senior party and government leaders) operate is very important, as their focus on political achievements may complicate how they manage environmental pollution in these cities. On the one hand, the traditional Gross Domestic Product-based quest for political achievement may lead top leaders to de-emphasize environmental pollution. On the other hand, changes made in 2003 to the way the performance of Chinese officials is evaluated have encouraged some local senior party and government leaders to pay more attention to environmental problems. Based on this, we analyze the relationship between political incentives and environmental pollution by applying the 2004-2014 panel data from 37 resource-exhausted cities. The findings reveal that firstly, among the factors which impact the environmental pollution of resource-exhausted cities, investment in fixed assets, foreign direct investment, industrial structure, per-capita education expenditure, and population density do not have a significant impact, thus indicating that local openness levels, the degree of industrial upgrading, and local investment in fixed assets are not the key variables in environmental pollution control. Secondly, the extent to which officials vie for political achievement affects environmental pollution in resource-exhausted cities. This depends upon whether the officials are municipal party secretaries or mayors; the former play a greater dynamic role in environmental pollution and have stronger robustness than the latter. The conclusion verifies both the existing authority structure of China and its effectiveness in the control of environmental pollution of resource-exhausted cities. That is to say, in contrast to the principles of the party committees, the mayors are in a subordinate position and often fail to fully and effectively exercise their functions. Accordingly, we point out that the selection of municipal party secretaries, rather than mayors, is particularly important in coming to terms with local environmental pollution.

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Do Developing Countries Invest Up? The Environmental Effects of Foreign Direct Investment from Less-Developed Countries

Cited by 101 publications

References 48 publications

The effects of FDI, economic growth and energy consumption on carbon emissions in ASEAN-5: Evidence from panel quantile regression

The effects of FDI, economic growth and energy consumption on carbon emissions in ASEAN-5: Evidence from panel quantile regression

Does foreign direct investment impede environmental quality in high-, middle-, and low-income countries?

How Have Political Incentives for Local Officials Reduced Environmental Pollution in Resource-Depleted Cities?

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