Massimiliano, Caporin, Cooray, Arusha, Kuziboev, Bekhzod, and Liu, Jie (2024) Chinese FDI outflows and host country environment. Journal of Environmental Management, 366. 121675.

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Abstract

This study provides first evidence on the effects of Chinese FDI (Foreign Direct Investment) outflows on host country environments. The study draws upon a comprehensive dataset covering aggregate Chinese FDI outflows and sector specific data into 65 host nations over the 2007–2019 period. Employing a STIRPAT (Stochastic Regression on Population, Affluence and Technology) model and several different techniques including DID (Difference-in-Difference), pooled OLS (Ordinary Least Squares), quantile regression, IV (Instrumental Variable) estimation, threshold and Tobit regression, the findings suggest that Chinese FDI leads to an increase in host country CO2 (Carbon Dioxide) emissions, aligning with the pollution haven hypothesis at the aggregate level. A closer investigation at the development regime and sectoral levels indicates that in the low development regime, FDI inflows into the financial and real estate sector increase emissions. Conversely in the high-income regime, Chinese FDI into the entertainment sector is associated with an increase in carbon emissions. Chinese FDI is further found to lead to an increase in emissions in countries with a per capita GDP (Gross Domestic Product) of below USD72041.7. However, as per capita income rises above USD72041.7, FDI leads to a fall in carbon emissions.

Item ID:	83528
Item Type:	Article (Research - C1)
ISSN:	1095-8630
Keywords:	Carbon emissions, FDI outflows, Host country environments, Sectoral development regime
Copyright Information:	© 2024 Elsevier Ltd. All rights are reserved, including those for text and data mining, AI training, and similar technologies.
Date Deposited:	04 Sep 2024 00:00
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