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Do Inward Foreign Direct Investment and Economic Development Improve Local Environmental Quality: Aggregation Bias Puzzle by Munir Ahmad; Gul Jabeen; Muhammad Irfan; Cem Işık; Abdul Rehman is a Environmental Science article available to read on EtoBox.

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Since preceding several decades, the carbon emissions based standard Environmental Kuznets Curve (EKC) has been tested and supported by a plethora of studies in countries around the globe. The current study estimated the inward foreign direct investment (IFDI)-augmented EKCs for China's 27 provincial divisions employing the advanced econometric methodologies involving cross-sectional dependence, slope heterogeneity, and second generation-based estimation procedures. The study has further contributed through a modification to "Stochastic Influence by Regression on Population, Affluence, and Technology" (STIRPAT) in terms of including IFDI to the standard model. Accordingly, this work estimated the standard EKC (involving economic development-carbon emissions linkage) as well as IFDI-carbon emissions linkage within the STIRPAT framework, by employing a panel vector error-correction-based estimation procedure. The findings revealed that (1) the conventional EKC estimates for national and regional samples (i.e., aggregate samples) presented linkages differing from the EKC links for the provincial divisions. It suggested that the EKC at the aggregated levels is likely the consequence of

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Author

Munir Ahmad; Gul Jabeen; Muhammad Irfan; Cem Işık; Abdul Rehman

Publisher

Springer Science and Business Media LLC

Published

2021

Language

EN

Field

Environmental Science (Physical Sciences)