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Foreign investment and CO2 emissions: do technological innovation and institutional quality matter? Evidence from system GMM approach
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Foreign investment and CO2 emissions: do technological innovation and institutional quality matter? Evidence from system GMM approach
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Journal Article
Foreign investment and CO2 emissions: do technological innovation and institutional quality matter? Evidence from system GMM approach
2021
Overview
The study examines the moderating role of institutional quality and technological innovation on the empirical relationship between FDI inflows and four indicator variables of
CO
2
emissions in 40 Asian countries for the period 1996–2016, by using generalized method of moment (GMM) estimation. First, from non-interactive regression, FDI inflows have positive impacts on
CO
2
emissions; over all, from our empirical results, we conclude that the moderating role of institutional quality and technological innovation is crucial in the nexus between FDI and carbon
CO
2
emissions and the interaction between institutional quality indicators and FDI inflows significantly reduce the level of
CO
2
emissions. Furthermore, the significant moderating effect of technological innovation is observed on the association between FDI and
CO
2
emissions. The results are important for policy makers in setting up long- and short-term policy to protect environmental quality.
Publisher
Springer Berlin Heidelberg,Springer Nature B.V
