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Role of foreign direct investment interaction to energy consumption and institutional governance in sustainable GHG emission reduction

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Abstract

The theme of the environmental upgrades and Sustainable Development Goals (SDGs) of the United Nations is “Better Environment, Better tomorrow.” This study uses regulatory quality (RgQ) and energy consumption per capita (EC) as explanatory variables and foreign direct investment (FDI) as an integrating variable with RgQ and EC and examines their impacts on greenhouse gas (GHG) emissions from 2001 to 2018 in panel Asian economies. The findings indicate that EC negatively impacts GHG emissions, while RgQ positively promotes the reduction of GHG emissions in Asia. In addition, FDI has an integrating role, as sufficient FDI inflows significantly enhance clean energy use and EC efficiency. Such inflows also support and improve Asia’s regulation quality by upgrading standardization investments and technology deployment to enhance institutional quality and achieve SDGs. FDI inflows have thus been vital in environment upgrading in Asia and regional sustainable environmental development.

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Data will be available on request and will on authors.

Funding

This research funded by Huazhong University of Science and Technology (HUST Main Campus), Wuhan, PR China. Under the “Research on the Intelligent Model of Social Governance in Cities, Key Project of National Social Science Fund.” Grant no.: 20AZD089

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  1. College of Public Administration, Huazhong University of Science and Technology-Main Campus, Wuhan, 430074, Hubei, China

    Hafiz Syed Mohsin Abbas, Xiaodong Xu & Chunxia Sun

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  1. Hafiz Syed Mohsin Abbas
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  2. Xiaodong Xu
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  3. Chunxia Sun
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Contributions

HSM. A wrote, conceptualized, and formal investigation and analysis; XX and CS supervised, administrate, and funded the research. SM. A software and data duration and methodology design. All authors read and approved the manuscript’s final version.

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Correspondence to Hafiz Syed Mohsin Abbas or Xiaodong Xu.

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Appendices

Appendix 1

List of sample countries

Azerbaijan, Bangladesh, China, India, Indonesia, Iran, Iraq, Israel, Japan, Kazakhstan, Kuwait, Malaysia, Oman, Pakistan, Philippines, Qatar, Russian Federation, Saudi Arabia, Singapore, South Korea, Sri Lanka, Thailand, Turkey, Turkmenistan, United Arab Emirates, Uzbekistan, Vietnam

Appendix 2

Table 11 Pooled OLS regression with Driscoll-Kraay standard errors (robustness)
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Table 12 Fixed effect regression with Driscoll-Kraay standard errors (robustness)
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Abbas, H.S.M., Xu, X. & Sun, C. Role of foreign direct investment interaction to energy consumption and institutional governance in sustainable GHG emission reduction. Environ Sci Pollut Res 28, 56808–56821 (2021). https://doi.org/10.1007/s11356-021-14650-7

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