Does foreign direct investment matter for environmental innovation in African economies?

Abstract

This study investigates the role of foreign direct investment (FDI) in environmental innovation in Africa during 1990–2019. It utilizes the endogenous growth theory to specify an innovation production function, estimated using the seemingly unrelated regression (SURE) method. The study employs four indicators of environmental innovation and also controls for the influence of resource abundance. Key findings from the study show evidence that FDI inflow enhances environmental innovation practices by improving resource efficiency outcomes. In particular, FDI is found to reduce greenhouse gas emission intensity of output and carbon intensity of energy. Further, the effect of FDI on resource utilization and energy productivity is insignificant. Estimates confirm the learning and imitation, and demonstration effects of FDI on resource utilization, though the formal effect is detrimental. The labour market effect is revealed to promote resource efficiency, while resource abundance plays negligible role in environmental innovation in all models. Policy implications are derived.

Does economic growth the cause of climate change or the cure? A spatial mediation-moderation model of foreign investment and eco-innovation orientation

“…Further, this outcome is in harmony with the study by Awodumi (2023). He suggested that FDI in uences positive energy intensity, minimizing carbon emissions and enhancing economic growth (Awodumi, 2023) Ultimately, the discoveries demonstrate that FDI moderates the direct relationship between (1) GDP and eco-innovation and (2) ecoinnovation and carbon emissions. As a result, the mediating effect between GDP and carbon emissions differs for MENA countries with varying levels of FDI.…”

“…As a result, this proves that FDI can signi cantly reinforce the GDP-eco-innovation nexus to reducing carbon emissions. Further, this outcome is in harmony with the study by Awodumi (2023). He suggested that FDI in uences positive energy intensity, minimizing carbon emissions and enhancing economic growth (Awodumi, 2023) Ultimately, the discoveries demonstrate that FDI moderates the direct relationship between (1) GDP and eco-innovation and (2) ecoinnovation and carbon emissions.…”

Linking foreign investment and eco-innovation to sustainable development goals through a spatial mediation-moderation model

“…Further, this outcome is consistent with the study by Awodumi (2022). He suggested that FDI influences positive energy intensity, minimizing carbon emissions and enhancing economic growth (Awodumi 2023). Huang et al (2022) showed economic growth and regulation systems negatively influence the effects of FDI on carbon emissions (Huang et al 2022).…”

Green innovation and firm performance: the mediating role of sustainability in the automotive industry

“…Under this scenario, green innovation is considered in the literature as one of the most important concepts that can help manufacturing companies reduce future difficulties through the development of greener and less polluting manufacturing operations (Zhao et al, 2022;Hu et al, 2023;Silva et al, 2023). Particularly, because only by changing the current production processes and systems and promoting the adoption and implementation of green innovation in all manufacturing companies, it is possible to truly achieve green development in the global economy (Zheng et al, 2023;Awodumi, 2023).…”

“…Particularly, because only by changing the current production processes and systems and promoting the adoption and implementation of green innovation in all manufacturing companies, it is possible to truly achieve green development in the global economy (Zheng et al. , 2023; Awodumi, 2023).…”