The relationship between FDI, CO2 emissions, and energy consumption in Asia-Pacific economic cooperation countries

BALLI E., SİGEZE Ç., Ugur M. S., ÇATIK A. N.

Environmental Science and Pollution Research, cilt.30, sa.15, ss.42845-42862, 2023 (SCI-Expanded, Scopus) identifier identifier identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 30 Sayı: 15
  • Basım Tarihi: 2023
  • Doi Numarası: 10.1007/s11356-021-17494-3
  • Dergi Adı: Environmental Science and Pollution Research
  • Derginin Tarandığı İndeksler: Science Citation Index Expanded (SCI-EXPANDED), Scopus, IBZ Online, ABI/INFORM, Aerospace Database, Aqualine, Aquatic Science & Fisheries Abstracts (ASFA), BIOSIS, CAB Abstracts, EMBASE, Environment Index, Geobase, MEDLINE, Pollution Abstracts, Veterinary Science Database, Civil Engineering Abstracts
  • Sayfa Sayıları: ss.42845-42862
  • Anahtar Kelimeler: Foreign direct investment, Energy consumption, CO2 emissions, APEC countries, Pollution haven hypothesis, Panel data analysis
  • Erzincan Binali Yıldırım Üniversitesi Adresli: Evet

Özet

© 2021, The Author(s), under exclusive licence to Springer-Verlag GmbH Germany, part of Springer Nature.This paper investigates the relationship between CO2 emissions, energy consumption, economic growth, and foreign direct investment for a sample of Asia-Pacific Economic Cooperation Countries (APEC) countries from 1981:Q1 to 2021:Q1 employing panel data methodology. We identify cross-sectional dependence and hence utilize the cross-sectional augmented Dickey-Fuller panel unit root test for appropriate estimation. The cointegration test developed by Westerlund (2008) reveals a long-run equilibrium between CO2 emissions, energy consumption, economic growth, and foreign direct investment. Long-run parameter estimates based on Common Correlated Effect Mean Group indicate that an increase in FDI inflows has a negative impact on air quality, supporting the pollution haven hypothesis. The cointegration test results also show that the impact of Gross Domestic Product (GDP) on CO2 emissions varies by country in the estimation sample. In contrast to the mixed evidence on the effects of other variables, the increase in energy consumption is positively and significantly affecting CO2 emissions in all APEC countries. Emirmahmutoglu and Kose Econ Model 28:870-876, (2011)’s panel causality test results show a bidirectional relationship between FDI and CO2 emissions in Japan. Furthermore, there is a bidirectional causal relationship between GDP and energy consumption in Australia, China, Japan, and Singapore. Overall, empirical evidence suggests that APEC countries should adhere to strict regulations and invest in environmental-friendly clean technologies to attract foreign direct investment.