Reinvestigating the pollution haven hypothesis: the nexus between foreign direct investments and environmental quality in G-20 countries

Musah, Mohammed; Mensah, Isaac Adjei; Alfred, Morrison; Mahmood, Haider; Murshed, Muntasir; Omari-Sasu, Akoto Yaw; Boateng, Frank; Nyeadi, Joseph Dery; Coffie, Cephas Paa Kwasi

doi:10.1007/s11356-021-17508-0

Cited by 86 publications

(25 citation statements)

References 89 publications

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“…Protecting the environment and achieving rapid economic growth are two common development objectives. Increases in environmental quality are associated with worse economic growth (Musah et al, 2022). For all of human history, nations have struggled to find a solution that allows for both economic development and environmental protection.…”

Section: Pollution Levels and Economic Stabilitymentioning

confidence: 99%

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The Impact of Investment, Economic Growth, Renewable Energy, Urbanisation, and Tourism on Carbon Emissions: Global Evidence

Kayani

Sadiq²,

Aysan

et al. 2023

IJEEP

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Examining urbanisation and tourism from the perspective of global Sustainable Development Goals is essential for achievinga balance between environmental protection and economic growth in the world's most polluted nations. Moreover, most polluted countries pay more attention to the nature of foreign direct investment (FDI) inflows to achieve a sustainableenvironment. This study intends to explore the impacts of FDI, tourism, urbanization, and economic growth on carbon dioxide emissions using panel data for the top ten most polluted nations for the period from 2000 to 2019. To guide empirical testing,the panel unit root tests LLC and IPS are used. The outcomes of LLC and IPS advise FM-OLS application on how to accomplish the goals. The findings provide proof of how FDI and other factors affect carbon emissions (CE). Particularly, renewable energy consumption (REC) has a detrimental but minor effect on CE. For the panel of developing nations, FDI had a favourable and significant effect on CE along with economic growth, tourism, and urbanization. The expansion of cities isalso harming nature and ecological footprints. These findings are alarming as all factors cause CE under consideration thatleads to the deterioration of the environment. Therefore, more environmental rules should be put into place to reduce CE, draw in clean FDI, and encourage quality-oriented investment in selected nations. Second, it is important to ensure the deployment of green technology and the upgrading of urbanized structures. The government can take several actions against the use of polluting goods and vehicles in urban areas, and any polluting industries should also be outlawed in such residential areas.

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Section: Pollution Levels and Economic Stabilitymentioning

confidence: 99%

“…The same holds true for carbon emissions' indirect consequences, like as economic growth and regulator quality. Numerous studies have looked at the link between FDI inflows and emissions of carbon directly, but FDI inflows may also indirectly impact emissions of carbon (Musah et al, 2022;Opoku and Boachie, 2020).…”

Section: Introductionmentioning

confidence: 99%

The Impact of Investment, Economic Growth, Renewable Energy, Urbanisation, and Tourism on Carbon Emissions: Global Evidence

Kayani

Sadiq²,

Aysan

et al. 2023

IJEEP

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show abstract

“…The research established the pollution haven hypothesis, which states that foreign investment degrades environmental quality [66,67]. Additionally, population-related emissions strain the natural environment, resulting in a country's emissions intensity [68,69]. The model stability test (see, Figure 3), performed using CUSUM and CUSUM square statistics, demonstrated that the model is stable over time and statistically significant at a 5% confidence range.…”

Section: Resultsmentioning

confidence: 93%

Cleaner Technology and Natural Resource Management: An Environmental Sustainability Perspective from China

et al. 2022

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In economies, cleaner technology, increased demand for renewable energy, and more efficient use of natural resources contribute to meeting environmental sustainability targets. The Chinese economy is no exception in its attempts to conserve economic and natural resources via collaborative efforts to embrace cleaner technology, green energy sources, and resource conservation management to preserve resources for future generations. This research examines the influence of cleaner technologies, green energy sources, and natural resource management on reducing greenhouse gas emissions using quarterly data for the Chinese economy from 2000Q1 to 2020Q4. The findings demonstrate that increasing demand for green energy reduces greenhouse gas emissions, hence substantiating the premise of ‘green is clean’ energy development. Additionally, optimum resource usage enhances environmental quality, corroborating the ‘resource cleaner blessing’ hypothesis. The positive link between inward foreign direct investment and greenhouse gas emissions substantiates the ‘pollution haven’ concept, according to which inward foreign direct investment uses unsustainable technology in manufacturing processes, hence degrading air quality indicators. Inadequate access to clean cooking technology and increased population density has a detrimental effect on the country’s environmental sustainability agenda, which must be corrected via sustainable regulations. The causality estimates show the feedback relationship between renewable energy demand (and economic growth) and cleaner technology, between economic growth and green energy (and inbound foreign direct investment), and between population density and economic growth (and green energy). The Impulse Response function estimates suggested that economic growth and population density would likely increase GHG emissions. In contrast, cleaner technology, green energy demand, natural resource management, and inbound foreign direct investment would likely decrease greenhouse gas emissions for the next ten-year time period. The sustainability of the environment and natural resources in China is bolstered by developing cleaner technologies, a greater reliance on renewable energy sources, and better management of natural resources.

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“…It raises the pollution level in emerging nations. The host nation (region) turns into a “pollution sanctuary” for industrialized nations (Musah et al 2022 ). The contrarian position is that FDI defies the “Pollution Haven Hypothesis.” Local businesses benefit from the sophisticated industrial and environmental technology offered by FDI.…”

Section: Methodsmentioning

confidence: 99%

Can fiscal decentralization be the route to the race to zero emissions in South Africa? Fresh policy insights from novel dynamic autoregressive distributed lag simulations approach

Udeagha

Breitenbach

2023

Environ Sci Pollut Res

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There has been a plethora of debate on the link between fiscal decentralization and a drop in carbon dioxide (CO 2 ) emissions, even though the evidence supporting this assertion is relatively sparse. Although the precise nature of this relationship is still up for discussion, economic hypothesis postulates that fiscal decentralization has an impact on environmental sustainability. Some researchers claim that fiscal decentralization could potentially result in a race to the top, while some believe it would lead to a race to the bottom. This analysis intends to shed light on the precise processes by which this connection may work in South Africa between 1960 and 2020 in light of current discussions in environmental and development economics. In contrary to previous studies, this paper employs a cutting-edge dynamic autoregressive distributed lag simulations methodology to evaluate the positive and negative variations in fiscal decentralization on CO 2 emissions. Our findings demonstrate the prevalence of the race to the top strategy by illustrating how fiscal decentralization has a bearing on CO 2 emissions reduction in the short and long terms. In accordance with the findings, greater fiscal decentralization should be implemented through the transfer of more powers to regional authorities, especially in the realm of environmental legislation considerations, in a bid to preserve South Africa’s environmental integrity. By establishing a lower tier of government and defining roles at the federal and provincial divisions, South Africa could adopt strategies to improve green environment in an effort to fulfill the energy-saving tasks of fiscal expenditures.

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Reinvestigating the pollution haven hypothesis: the nexus between foreign direct investments and environmental quality in G-20 countries

Cited by 86 publications

References 89 publications

The Impact of Investment, Economic Growth, Renewable Energy, Urbanisation, and Tourism on Carbon Emissions: Global Evidence

The Impact of Investment, Economic Growth, Renewable Energy, Urbanisation, and Tourism on Carbon Emissions: Global Evidence

Cleaner Technology and Natural Resource Management: An Environmental Sustainability Perspective from China

Can fiscal decentralization be the route to the race to zero emissions in South Africa? Fresh policy insights from novel dynamic autoregressive distributed lag simulations approach

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