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Foreign direct investment, environmental regulation, and haze pollution: empirical evidence from China

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Abstract

As China’s economy continues to grow, more and more attention is being paid to environmental pollution issues, including haze pollution, which is the most prominent of the air problems. In order to alleviate the haze pollution problem while ensuring the normal operation of the economy, the government has adopted an environmental regulation policy along with the introduction of foreign direct investment. This study uses a fixed effects model and two-stage least squares to examine the correlation of foreign direct investment and environmental regulation to the haze pollution level by using the Chinese provincial panel data from 2008 to 2019. We found a positive interaction between the foreign direct investment and environmental regulation, where a high-quality investment promotes the haze reduction, and the environmental regulation can enhance this effect. The results approve the possibilities that China can bring the merit investment and reduce its air pollution simultaneously, but how to balance the interaction between environmental regulation and the investment needs to draw attention.

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Data availability

The datasets used and/or analyzed during the current study are available from the corresponding author on reasonable request.

Notes

  1. The download address is http://fizz.phys.dal.ca/~atmos/martin/?page_id=140.

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Acknowledgements

Thank you for China University of Geosciences for its help in this article. The authors also express sincere gratitude to the anonymous reviewers for their meaningful suggestions.

Funding

This work was supported by the Ministry of Education Philosophy and Social Sciences Fund (NO.17YJC790122).

Author information

Authors and Affiliations

  1. School of Economics and Management, China University of Geosciences, Hubei, China

    Yanyu Guan, Ziyu Zhai, Di Wu & Zhiqin Lei

  2. New Zealand Forest Research Institute (Scion), Rotorua, New Zealand

    Yue Wang

  3. China Huarong Asset Management Co. LTD., Beijing, China

    Lanlan Yu

Authors
  1. Yanyu Guan
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  2. Ziyu Zhai
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  3. Yue Wang
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  4. Di Wu
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  5. Lanlan Yu
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  6. Zhiqin Lei
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Contributions

YW and YG conceived the idea; DW and Y G organized the data and designed the model; ZZ and YG performed the data analysis and interpretation; YG, LY, and ZL wrote the paper and provided feedback to all authors. All authors read and approved the final manuscript.

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Correspondence to Yanyu Guan.

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Guan, Y., Zhai, Z., Wang, Y. et al. Foreign direct investment, environmental regulation, and haze pollution: empirical evidence from China. Environ Sci Pollut Res 29, 27571–27584 (2022). https://doi.org/10.1007/s11356-021-17841-4

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  • DOI: https://doi.org/10.1007/s11356-021-17841-4

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