Foreign direct investment, institutional development, and environmental externalities: Evidence from China

Wang, Danny T.; Chen, Wendy Y.

doi:10.1016/j.jenvman.2014.01.013

Cited by 122 publications

(87 citation statements)

References 54 publications

(91 reference statements)

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“…To the best of our knowledge, this research uses the longest time period and more pollutant measures at the city level and thus extends earlier empirical studies on China, e.g. those of Cole et al (2011) and Wang and Chen (2014).…”

Section: Introductionmentioning

confidence: 69%

“…This dependence also applies to FDI-EKE (Wang and Chen 2014). FDI spillovers can be conditioned by a range of factors, such as local absorptive capability, effective linkages between foreign and domestic firms in the local value chain, a sufficient stock and mobility of local human capital, the level of foreign tangible assets, as well as pace and regularity of the entry process (Crespo and Fontoura 2007;Lan et al 2012;Meyer and Sinani 2009;Wang and Chen 2014). Although the literature specifically addressing the determinants of FDI environmental spillovers is sparse, several attempts have been made to highlight the importance of local capabilities.…”

Section: Regional Dimension Of Fdi Environmental Knowledge Externalitmentioning

confidence: 93%

“…Moreover, given the weak environmental regulatory and institutional development in the host developing countries, MNEs can choose to transfer outdated and polluting technologies to avoid the cost of environmental regulation compliance in their home countries. The presence of FDI could therefore be detrimental to the local environment as the 'pollution haven hypothesis' postulates (Javorcik and Wei 2009;Wang and Chen 2014).…”

Section: Fdi and Environmental Spilloversmentioning

confidence: 99%

“…Similar to the work of Zarsky (1999) and He (2006) finds empirically that a scale effect of industrial output contributed by FDI in Chinese provinces would increase the level of the pollution generated and have only a marginal impact on industrial emissions, although MNEs were found to be generally more environmentally efficient. Similarly, Wang and Chen (2014) use a panel of Chinese city-level data and demonstrate that FDI in general generates negative environmental externalities.…”

Section: Fdi and Environmental Spilloversmentioning

confidence: 99%

“…Whether FDI has a positive or negative spillover effect, however, depends on both endogenous and exogenous factors and not entirely on the amount of FDI inflows (Crespo and Fontoura 2007). This dependence also applies to FDI-EKE (Wang and Chen 2014). FDI spillovers can be conditioned by a range of factors, such as local absorptive capability, effective linkages between foreign and domestic firms in the local value chain, a sufficient stock and mobility of local human capital, the level of foreign tangible assets, as well as pace and regularity of the entry process (Crespo and Fontoura 2007;Lan et al 2012;Meyer and Sinani 2009;Wang and Chen 2014).…”

Section: Regional Dimension Of Fdi Environmental Knowledge Externalitmentioning

confidence: 99%

See 4 more Smart Citations

Does FDI Bring Environmental Knowledge Spillovers to Developing Countries? The Role of the Local Industrial Structure

Ning

Wang

2017

Environ Resource Econ

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This paper examines the environmental knowledge externalities of FDI within and across cities in an emerging economy context. It argues that the extent of these environmental externalities is contingent upon local industrial agglomeration. Using a panel dataset of 280 Chinese prefectural cities from 2003 to 2012, we employ a spatial economic approach. Although limited to evidence from soot and SO 2 pollutants, our results suggest that FDI brings overall positive environmental knowledge externalities to a region, and also spillovers to nearby regions. Specialised cities may lock into a particular technological path, attenuating the absorption and diffusion of a variety of FDI environmental knowledge. Conversely, diversified cities promote cross-fertilisation of environmental knowledge and mitigate local pollution intensity at the aggregated city level. This study adds to the literature by highlighting the importance of considering both the spatiality of FDI and industrial structure in understanding FDI environmental knowledge spillovers.

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Section: Introductionmentioning

confidence: 69%

Section: Regional Dimension Of Fdi Environmental Knowledge Externalitmentioning

confidence: 93%

Section: Fdi and Environmental Spilloversmentioning

confidence: 99%

Section: Fdi and Environmental Spilloversmentioning

confidence: 99%

Section: Regional Dimension Of Fdi Environmental Knowledge Externalitmentioning

confidence: 99%

See 3 more Smart Citations

Does FDI Bring Environmental Knowledge Spillovers to Developing Countries? The Role of the Local Industrial Structure

Ning

Wang

2017

Environ Resource Econ

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Does foreign direct investment promote environmental efficiency in developing economies? Evidence from Economic Community of West African States

Awodumi

2020

Bus Strat Dev

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Foreign direct investment (FDI) continues to play a vital role in developing economies following its ability to fill a number of gaps, chief among which is technology gap. However, the contribution of such FDI inflow to environmental quality, hence sustainable development, has been questioned severally in the literature. This study investigates the role of inward FDI in environmental efficiency among the Economic Community of West African States (ECOWAS) countries during 1980-2016. It utilizes the pollution haven (halo) hypothesis and estimated the specified model using the autoregressive distributed lag techniques for the individual countries, and random and fixed effect, as well as seemingly unrelated regression methods for the panel analysis. Findings show evidence that FDI inflow hampers environmental efficiency in all ECOWAS countries, except Sierra Leone where increased inflow of FDI promotes environmental efficiency only in the short run. Results also show that energy intensity has significant negative effect on environmental efficiency in Benin (short run), Burkina Faso, The Gambia, Mali (short run), Togo and panel of countries, suggesting that energy-efficient technology enhances this efficiency. ECOWAS policy formulation must therefore harness the potential benefits that inward FDI brings to the community by harmonizing environmental regulations among its members in order to make the region safe and environmentally attractive to clean foreign investment. Other policy implications are derived for sustainable development of the community.

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Impact of entrepreneur's socioeconomic status on corporate environmental conduct and misconduct: The moderating role of family ownership

Shi,

Zhao,

Chen

et al. 2024

Corp Soc Responsibility Env

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The impact of an actor's status on corporate ethical issues has been debated in strategy management. Drawing on upper echelons theory and status theory, our study aims to address this theoretical puzzle by examining how an entrepreneur's socioeconomic status affects a firm's engagement in positive environmental conduct and negative environmental misconduct, as well as the moderating effects of family ownership in China's emerging economy. Our analysis of 3281 private firms from a national survey in China reveals that an entrepreneur's socioeconomic status not only promotes corporate environmental conduct but also stimulates environmental misconduct. These effects are more pronounced in firms with higher levels of family ownership. By uncovering the complex impact of an entrepreneur's socioeconomic status on corporate environmental actions, our study contributes novel insights to the environmental management literature.

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Foreign direct investment, institutional development, and environmental externalities: Evidence from China

Cited by 122 publications

References 54 publications

Does FDI Bring Environmental Knowledge Spillovers to Developing Countries? The Role of the Local Industrial Structure

Does FDI Bring Environmental Knowledge Spillovers to Developing Countries? The Role of the Local Industrial Structure

Does foreign direct investment promote environmental efficiency in developing economies? Evidence from Economic Community of West African States

Impact of entrepreneur's socioeconomic status on corporate environmental conduct and misconduct: The moderating role of family ownership

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