The Impact of Foreign Direct Investment and R&D Expenditures on Climate Change: The Case Of BRICS-T and Selected OECD Member Countries

Abstract

Climate change, one of the most urgent problems of today's world, is an important issue emphasized by researchers and policymakers. Climate change, which has become a global problem, has negative consequences on the environment and people. Therefore, the main objective of this study is to investigate the impact of FDI and R&D expenditures on climate change in BRICS-T (Brazil, Russia, India, China, South Africa, Turkey) and selected OECD (United Kingdom, Italy, Canada, Spain, Portugal, Denmark, Norway, Austria, Spain, Portugal, Denmark, Norway, Australia) member countries for the period 2000-2020 using panel data analysis method. OECD and BRICS-T country groups are analyzed separately. According to the results of the analysis, it is found that there is no causality relationship between climate change and research and development variables, while there is a bidirectional causality relationship between research and development and foreign direct investment variables. When the causality relationship is analyzed for countries and variables, it is found that there is a bidirectional causality relationship between research and development and FDI variables for Russia and India, and a unidirectional causality relationship from research and development variable to FDI variable for China, South Africa and Turkey.