FDI and Environmental Sustainability Nexus: Testing the Pollution Haven Hypothesis in the Presence of Regulatory Quality

doi:10.55057/ijaref.2022.4.3.25

Cited by 1 publication

(2 citation statements)

References 30 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Similarly, Nyeadi (2022) found a positive and significant relationship between FDI and carbon dioxide in low-income countries. Based on the pollution heaven hypothesis and fully modified least squares (FMOLS) technique Yakubu & Musah (2022) concludes that FDI inflows positively and significantly drive environmental pollution in Ghana from 2000Q1-2017Q4. Bunyaminu & Yakubu (2022) also found that FDI inflows decreases renewable energy demand but increases carbon dioxide emissions in Africa, hence supporting the PHH.…”

Section: Fdi and Environmental Degradationmentioning

confidence: 99%

“…It is argued that FDI inflows lead to more CO 2 emissions especially as investors explore cheaper means of production which is hazardous to the environment (Nyeadi, 2022). This is particularly true for developing countries like SSA with relaxed environmental regulations thereby attracting firms with high pollution levels from developed countriesa situation known as pollution haven hypothesis (PHH) (Yakubu & Musah, 2022). At the same time, it is claimed that FDI contributes positively to the economy of the host country in the domain of knowledge diffusion, technological transfer, and access to markets (Wei & Zhou, 2022).…”

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

Foreign Direct Investment, Trade Openness and Environmental Degradation in SSA Countries. A Quadratic Modeling and Turning Point Approach

Ewane

2023

Am. J. Environ. Econ.

View full text Add to dashboard Cite

The consequences of carbon dioxide (CO2) emissions in Sub Saharan Africa (SSA) countries cannot be ignore given it adverse effect on human health and global warming. With rising CO2 emissions and fallen volume of trade openness and FDI inflows in recent time, we seek to examine the effect of trade openness and foreign direct investment (FDI) on environmental degradation using time series data from 1975 to 2020 in SSA. Using the environmental Kuznets curve (EKC) framework, the study employs a quadratic modeling and turning point approach to realize the study objectives. The findings reveals that (1) the trade openness-EKC and FDI-EKC does not hold given the presence of decreasing effects in the short run and increasing effects in the long run; (2) it confirms that a U-shaped trade openness-emissions and FDI-emission nexus holds given the decrease in trade openness and FDI in the short run and an increase in trade openness and FDI in the longrun; (3) The analysis supports the halo effect hypothesis before the turning point but the pollution haven hypothesis sets in after the turning point; (4) it shows evidence that trade openness and FDI contributes to reduce CO2 emissions in the short but increase it in the long run. The study recommends that SSA countries should adopt stringent environmental policies to attain sustainable economic growth without associative harm to the environment.

show abstract

Section: Fdi and Environmental Degradationmentioning

confidence: 99%