The Effect of Foreign Direct Investment on Human Well-Being: A Study of the Relationship Between the Carbon Intensity of Human Well-Being and Foreign Direct Investment in Nine Lower Middle-Income Countries

Economic growth is the primary purpose for human development of all nations in the world; however, it is needed to put into question whether the growth has brought more benefits to human-being or caused costly consequences for the environment and societies. The paper has studied the carbon intensity of human well-being (CIWB), the level of anthropogenic carbon emissions per unit of human well-being, to measure the relationship between economic growth and human well-being in terms of sustainability. Approach from the theory of ecologically unequal exchange, the study applied Prais–Winsten technique to analyze the function of CIWB and economic variables in nine lower middle-income countries in the period of 2000–2018. We found that economic activities have significantly enhanced human well-being, which hasn’t supported the theory. The variables of foreign direct investment (FDI) over time and gross domestic product (GDP) showed negative effects on CIWB, which implies the more value of FDI and GDP, the less CIWB value. However, these countries should be cautioned on strategies for sustainable development, the FDI effect on decreasing CIWB over time is low and unstable. Moreover, the study revealed that energy consumption (EPC) positively impacts the value of CIWB.