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Effect of Economic Growth and Foreign Direct Investment on Carbon emission in the Asian States

Author

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  • Toto Gunarto

    (Faculty of Economics and Business, The University of Lampung, Indonesia)

Abstract

This research article analyzes the relationship between carbon dioxide gas emission, economic development, energy consumption and FDI in Asian states. The Autoregressive Distribution of Lag bounds tests has been applied for co-integration from 1970 to 2014. According to the results, there is a direct relationship between energy consumption and carbon dioxide gas emission. Moreover, there is no existence of a significant relationship between FDI and gas emission of carbon dioxide. In the long run, the coefficient value of FDI is insignificant and hence it shows confusion about the decision whether FDI will be a cause to increase the carbon dioxide gas emission or not. These results are suitable for the Asian countries that they should focus on the energy consumption that produce the carbon emission and damaged the environment severely and also put their intension on the growth part of this aspect. This study also provided the insight to the regulation making authorities while formulating policies on environmental condition of the country.

Suggested Citation

  • Toto Gunarto, 2020. "Effect of Economic Growth and Foreign Direct Investment on Carbon emission in the Asian States," International Journal of Energy Economics and Policy, Econjournals, vol. 10(5), pages 563-569.
    • Handle: RePEc:eco:journ2:2020-05-66
    as

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    References listed on IDEAS

    as
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    2. Korhan Gökmenoğlu & Nigar Taspinar, 2016. "The relationship between Co 2 emissions, energy consumption, economic growth and FDI: the case of Turkey," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 25(5), pages 706-723, August.
    3. Hanif, Imran & Faraz Raza, Syed Muhammad & Gago-de-Santos, Pilar & Abbas, Qaiser, 2019. "Fossil fuels, foreign direct investment, and economic growth have triggered CO2 emissions in emerging Asian economies: Some empirical evidence," Energy, Elsevier, vol. 171(C), pages 493-501.
    4. Kais, Saidi & Sami, Hammami, 2016. "An econometric study of the impact of economic growth and energy use on carbon emissions: Panel data evidence from fifty eight countries," Renewable and Sustainable Energy Reviews, Elsevier, vol. 59(C), pages 1101-1110.
    5. Mohamed Abdouli & Sami Hammami, 2017. "The Impact of FDI Inflows and Environmental Quality on Economic Growth: an Empirical Study for the MENA Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 8(1), pages 254-278, March.
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    Cited by:

    1. Hou Renyong & Aman Ali Sedik, 2023. "Environmental Sustainability and Foreign Direct Investment in East Africa: Institutional and Policy Benefits for Environmental Sustainability," Sustainability, MDPI, vol. 15(2), pages 1-22, January.
    2. Rinku Manocha, 2024. "Do FDI Flows Lead to Environmental Degradation in Developing Economies? A Case Study of Select Asian Economies," Vision, , vol. 28(2), pages 237-250, April.

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    More about this item

    Keywords

    Carbon Dioxide Emissions; Foreign Direct Investment; Economic Development; Energy consumption;
    All these keywords.

    JEL classification:

    • P18 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Energy; Environment
    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development

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