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Foreign Direct Investment and the Environment: Pollution Haven Hypothesis Revisted

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  • Aliyu, Mohammed Aminu

Abstract

We examine the impact of environmental policy on location decision, the outflow of “dirty” Foreign Direct Investment (FDI). We also examine the impact of “dirty” FDI in host countries, on annual CO2 total emission; total emission of known particulate matters; rising temperature; and total energy use. Using disaggregated FDI data, panel data regression, we found that, “dirty” FDI outflow is positively correlated with environmental policy in eleven OECD countries. But FDI inflow is not significant in explaining the level of pollution and energy use in fourteen non-OECD countries.

Suggested Citation

  • Aliyu, Mohammed Aminu, 2005. "Foreign Direct Investment and the Environment: Pollution Haven Hypothesis Revisted," Conference papers 331376, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    • Handle: RePEc:ags:pugtwp:331376
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    1. Liton Chandra Voumik & Salma Akter & Mohammad Ridwan & Abdul Rahim Ridzuan & Amin Pujiati & Bestari Dwi Handayani & J. S. Keshminder & Mohamad Idham Md Razak, 2023. "Exploring the Factors behind Renewable Energy Consumption in Indonesia: Analyzing the Impact of Corruption and Innovation using ARDL Model," International Journal of Energy Economics and Policy, Econjournals, vol. 13(5), pages 115-125, September.
    2. Tiwari, Sunil, 2024. "Impact of Fintech on natural resources management: How financial impacts shape the association?," Resources Policy, Elsevier, vol. 90(C).
    3. Su, Chi Wei & Yue, Peiwen & Hou, Xinmeng & Dördüncü, Hazar, 2023. "Sustainable development through digital innovation: A new era for natural resource extraction and trade," Resources Policy, Elsevier, vol. 85(PB).
    4. Lyubov Tsoy & Almas Heshmati, 2024. "Is FDI inflow bad for environmental sustainability?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(11), pages 28843-28858, November.
    5. Luigi Lannutti, 0000. "The role of Environmental, Social and Governance (ESG) regulations in attracting Foreign Direct Investment (FDI)," Proceedings of International Academic Conferences 14216212, International Institute of Social and Economic Sciences.
    6. Barut, Abdulkadir & Kaya, Emine & Bekun, Festus Victor & Cengiz, Sevgi, 2023. "Environmental sustainability amidst financial inclusion in five fragile economies: Evidence from lens of environmental Kuznets curve," Energy, Elsevier, vol. 269(C).
    7. Destek, Mehmet Akif & Sohag, Kazi & Aydın, Sercan & Destek, Gamze, 2022. "Foreign direct investment, stock market capitalization and sustainable development: Relative impacts of domestic and foreign capital," MPRA Paper 117551, University Library of Munich, Germany.
    8. Palash Basak & Salim Momtaz & Troy F. Gaston & Soma Dey, 2023. "Changing Land Use and Urban Dynamics around an Industrial Zone in Bangladesh: A Remote Sensing Analysis," Land, MDPI, vol. 12(9), pages 1-19, September.
    9. Gong, Zhonghang & Wu, Yuqin & Tawiah, Vincent & Abdulrasheed, Zakari, 2023. "The environmental footprint of international business in Africa; The role of natural resources," Resources Policy, Elsevier, vol. 80(C).

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