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How does foreign direct investment improve urban air quality?

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Abstract

Foreign direct investment and environmental pollution have been a prominent topic in China’s economic development. Therefore, this paper investigates the relationship between foreign direct investment and environmental pollution, and makes practical policy recommendations to support the harmonious development of economy and environment based on the study findings. In this paper, the spatial econometric approach framework with the spatial weight matrix of the Delaunay method is used to examine the influence of foreign direct investment on the level of urban air quality. It uses air quality index as an indicator to measure air pollution comprehensively. Based on the spatial autocorrelation with the aggregation and radiation effects of foreign direct investment, the results show that the distribution of air pollution has considerable spatial impact in terms of spatial nonequilibrium. Through the empirical analysis, our finding reveals that the increase in GDP, the share of secondary industry, and population growth are the important elements affecting the change in air quality.

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The datasets generated and/or analyzed during the current study are not publicly available due to the confidentiality agreement of the patent data, but are available from the corresponding author on reasonable request.

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Funding

This work is supported by Humanities and Social Sciences Youth Foundation, Ministry of Education of the People’s Republic of China (Grant No. 22YJCZH085). This work is also funded by Science and Technology Project of Hebei Education Department [BJ2021060]. The received financial support from the National Natural Science Foundation of China (72104028) and the Beijing Institute of Technology Research Fund Program for Young Scholars.

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Writing–Original Draft Preparation, Ranran Li and Zhiyang Shen; Writing–Review and Editing, Ranran Li and Zhiyang Shen. All authors have read and agreed to the published version of the manuscript.

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Correspondence to Zhiyang Shen.

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Li, R., Shen, Z. How does foreign direct investment improve urban air quality?. Environ Sci Pollut Res 30, 43665–43676 (2023). https://doi.org/10.1007/s11356-023-25324-x

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