FDI and CO2 emissions in developing countries: the role of human capital

FDI inflows remain an important source of economic growth and technology transfer for developing countries. However, the proponents of the pollution haven hypothesis (PHH) argue that FDI inflows may result in the production of polluted goods in poor economies. The empirical testing of PHH reveals co...

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Vydané v:Natural hazards (Dordrecht) Ročník 117; číslo 1; s. 1125 - 1155
Hlavní autori: Khan, Muhammad, Rana, Arslan Tariq, Ghardallou, Wafa
Médium: Journal Article
Jazyk:English
Vydavateľské údaje: Dordrecht Springer Netherlands 01.05.2023
Springer Nature B.V
Predmet:
Carbon dioxide
Carbon dioxide emissions
Civil Engineering
Developing countries
Earth and Environmental Science
Earth Sciences
Economic development
Economic growth
Education
Emissions
Environmental Kuznets curve
Environmental Management
Environmental quality
Error correction
Geophysics/Geodesy
Geotechnical Engineering & Applied Earth Sciences
Human capital
Hydrogeology
LDCs
Natural Hazards
Original Paper
Pollution
Social sciences
Technology transfer
O13
Human capital
Economic growth
Developing countries
F25
FDI
CO
emissions
I25
ISSN:0921-030X, 1573-0840
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Shrnutí:FDI inflows remain an important source of economic growth and technology transfer for developing countries. However, the proponents of the pollution haven hypothesis (PHH) argue that FDI inflows may result in the production of polluted goods in poor economies. The empirical testing of PHH reveals conflicting outcomes on the subject. This study argues that foreign firms’ choice of specific technologies and hence the validity of PHH can be determined by host countries’ level of education. For developing economies having low levels of schooling, FDI inflows will accompany polluted technologies. Nonetheless, when education levels exceed certain thresholds, FDI inflows may reduce CO 2 emissions. For our empirical investigation, we rely upon a large panel of 108 developing countries during 2000–2016. Our estimated outcomes, based on the panel cointegration method and panel vector error correction methods (P-VECM), confirm these moderating effects of human capital in the FDI–CO 2 emissions nexus. The empirical results also confirm the presence of the environmental Kuznets curve (EKC) for developing countries. These results have important policy implications for the sample economies.
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ISSN:0921-030X
1573-0840
DOI:10.1007/s11069-023-05949-4