Environmental impact of economic growth, emission and FDI: systematic review of reviews

2019 ◽  
Vol 11 (1) ◽  
pp. 81-134 ◽  
Author(s):  
Neha Saini ◽  
Monica Sighania
Keyword(s):  
Economic Growth ◽  
Carbon Emission ◽  
Capital Inflows ◽  
Kuznets Curve ◽  
Negative Effects ◽  
Research Papers ◽  
Content Type ◽  
The Status ◽  
Review Of Reviews ◽  
Foreign Capital Inflows

PurposeThe purpose of this paper is to organize the detailed review of economic growth, carbon emission and foreign capital inflows and its impact on the environment. Another objective of the study is to provide the comprehensive bibliography and to analyze the findings and results of the studies undertaken in review.Design/methodology/approachThis paper examined 111 research papers from a sample of thousands of papers, based on inclusion criteria, in this area of research. These 111 research papers are categorized on the basis of several factors to know the status of research on this topic.FindingsThis study is based on economic development and carbon emission and its impact on the environment. We tried to gather all the available facts based on this topic and found that the topic is gaining high relevance in the present scenario because of the growing pace of development in developing countries. Most of the studies supported the environmental Kuznets curve hypothesis and we also found that significant amount of literature is available which supports cleaner FDI as a measure to mitigate the negative effects of economic growth on the ecological environment.Originality/valueBased on the literature review from various sources, this study provides the collection, classification and comprehensive bibliography on this topic, which may be helpful for stakeholders such as academicians, researchers and policymakers working particularly in this area of research.

The impact of foreign capital inflows on economic growth and employment in Egypt

2019 ◽  
Vol 36 (3) ◽  
pp. 258-276
Author(s):  
Hanan AbdelKhalik Abouelfarag ◽  
Mohamed Sayed Abed
Keyword(s):  
Economic Growth ◽  
Time Series ◽  
Foreign Investment ◽  
External Debt ◽  
Capital Inflows ◽  
Aggregate Model ◽  
Employment Level ◽  
Content Type ◽  
Foreign Capital Inflows ◽  
The Impact

Purpose The purpose of this paper is to trace the effects of both foreign direct investment (FDI) and external debt on economic growth and employment in Egypt over the 1985–2014 period. Design/methodology/approach The empirical analysis includes three stages: an aggregate time series analysis, a panel model that includes six economic sectors and a set of single-sector models. The “autoregressive distributed lag” approach is utilized either in the time series or in the panel models. Findings The empirical results of this research reveal that foreign investment exerts a weak positive effect on economic growth and employment in Egypt. External debt exerts an insignificant effect on economic growth and employment in the aggregate model. The sectoral analysis reveals that the effect varies greatly between sectors; the effect of FDI on output is positive in the financial, tourism and other service sectors, while it is insignificant in the agricultural, construction and manufacturing sectors. Practical implications It is important not to depend on external debt as an easy way to obtain capital. Greater efforts should be exerted to increase the absorptive capacity of the Egyptian economy so as to benefit from the positive spillover effect of foreign investment as much as possible. Originality/value With respect to Egypt, very limited studies have focussed on the role of external debt on growth and that of FDI and external debt on the employment level. There is no general agreement concerning the effect of FDI on economic growth. Therefore, this research explores the effect of FDI and external debt on the Egyptian economy utilizing both aggregate and sectoral data.

Environmental Kuznets curve for CO2 emissions: a literature survey

2019 ◽  
Vol 46 (1) ◽  
pp. 106-168 ◽  
Author(s):  
Muhammad Shahbaz ◽  
Avik Sinha
Keyword(s):  
Environmental Kuznets Curve ◽  
Social Indicators ◽  
Ecological Economics ◽  
Capital Inflows ◽  
Empirical Literature ◽  
Kuznets Curve ◽  
Empirical Estimation ◽  
Data Set ◽  
Content Type ◽  
Foreign Capital Inflows

Purpose The purpose of this paper is to provide a survey of the empirical literature on environmental Kuznets curve (EKC) estimation of carbon dioxide (CO2) emissions over the period of 1991–2017. Design/methodology/approach This survey categorizes the studies on the basis of power of income in empirical models of EKC. It has been hypothesized that the EKC shows an inverted U-shaped association between economic growth and CO2 emissions. Findings For all the contexts, the results of EKC estimation for CO2 emissions are inconclusive in nature. The reasons behind this discrepancy can be attributed to the choice of contexts, time period, explanatory variables, and methodological adaptation. Research limitations/implications The future studies in this context should not only consider new set of variables (e.g. corruption index, social indicators, political scenario, energy research and development expenditures, foreign capital inflows, happiness, population education structure, public investment toward alternate energy exploration, etc.), but also the data set should be refined, so that the EKC estimation issues raised by Stern (2004) can be addressed. Originality/value By far, no study in the literature of ecological economics has focused on the empirical estimation of EKC for CO2 emissions. This particular context has been used for this study, as CO2 is one of the highest studied pollutants in the ecological economics, and especially within the EKC hypothesis framework.

Foreign capital inflows: a panacea to slow economic growth and infrastructure decay in Africa?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Olumide Olusegun Olaoye ◽  
Oluwatosin Odunayo Eluwole ◽  
Faraz Lakhani
Keyword(s):  
Economic Growth ◽  
Government Spending ◽  
Foreign Capital ◽  
Developing Economies ◽  
Generalized Method Of Moments ◽  
Capital Inflows ◽  
Foreign Direct Investments ◽  
Content Type ◽  
Foreign Capital Inflows ◽  
The Relationship

PurposeThe purpose of this study is to examine the effect of foreign capital inflows on economic growth in 15 Economic Community of West African States (ECOWAS) countries over the period 2008–2018. Specifically, this paper investigates whether selected foreign capital inflows, namely, foreign debt, foreign aid and foreign direct investments substitute or complement government spending in ECOWAS.Design/methodology/approachThe study adopts the two-step system generalized method of moments (GMM) method of estimation to address the problem of dynamic endogeneity inherent in the relationship.FindingsThe result shows that foreign capital inflows into ECOWAS region have not transmitted into economic growth in the region. Further, the findings reveal that foreign capital inflows to ECOWAS have substituted for government spending. The results might be as a result of the high level of corruption in ECOWAS. The results also show that when institutional quality is interacted with foreign capital inflows, the result shows a negative and statistically significant effect on economic growth.Originality/valueUnlike previous studies which pooled both developed and developing economies together, the authors investigate this relationship in a regional study, using ECOWAS to create a roughly optimum size. In addition, the authors adopt the GMM-system method of estimation to address the problem of dynamic endogeneity inherent in the relationship, which has largely been ignored in extant studies.

Is stock market sensitive to foreign capital inflows and economic growth?

2015 ◽  
Vol 8 (3) ◽  
pp. 142-164 ◽  
Author(s):  
Syed Ali Raza ◽  
Syed Tehseen Jawaid ◽  
Sahar Afshan ◽  
Mohd Zaini Abd Karim
Keyword(s):  
Economic Growth ◽  
Stock Market ◽  
Foreign Capital ◽  
Capital Inflows ◽  
Series Data ◽  
Content Type ◽  
Market Capitalization ◽  
Long Run ◽  
Foreign Capital Inflows ◽  
Stock Market Capitalization

Purpose – The purpose of this study is to investigate the impact of foreign capital inflows and economic growth on stock market capitalization in Pakistan by using the annual time series data from the period of 1976 to 2011. Design/methodology/approach – The autoregressive distributed lag bound testing cointegration approach, the error correction model and the rolling window estimation procedures have been performed to analyze the long run, short run and behavior of coefficients, respectively. Findings – Results indicate that foreign direct investment (FDI), workers’ remittances and economic growth have significant positive relationship with the stock market capitalization in long run as well as in short run. Results of the dynamic ordinary least square and the fully modified ordinary least square suggest that the initial results of long-run coefficients are robust. Results of variance decomposition test show the bidirectional causal relationship of FDI and economic growth with stock market capitalization. However, unidirectional causal relationship is found in between workers’ remittances and stock market capitalization. Practical implications – It is suggested that in Pakistan, investors can make their investment decisions through keeping an eye on the direction of the considered foreign capital inflows and economic growth. Originality/value – This paper makes a unique contribution to the literature with reference to Pakistan, being a pioneering attempt to investigate the effects of foreign capital inflows and economic growth on stock market by using long time series data and applying more rigorous techniques.

Endogenous specification of foreign capital inflows, human capital development and economic growth

2019 ◽  
Vol 46 (3) ◽  
pp. 454-472 ◽  
Author(s):  
Hammed Oluwaseyi Musibau ◽  
Agboola Hammed Yusuf ◽  
Kafilah Lola Gold
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Foreign Capital ◽  
Capital Inflows ◽  
Group Method ◽  
Human Capital Development ◽  
Content Type ◽  
Foreign Capital Inflows ◽  
Capital Development ◽  
The Relationship

PurposeThe purpose of this paper is to empirically investigate the relationship between foreign capital inflows, human capital development (HCD) and economic growth in ECOWAS countries.Design/methodology/approachIn line with the augmented Solow model, the relationship between foreign capital inflows, human capital development and gross domestic product in the ECOWAS member countries is investigated using the pool mean group method.FindingsThe authors find overwhelming evidence that foreign capital inflows and human development have a significant effect on economic growth in ECOWAS member countries. However, foreign direct investment (FDI), official development assistant, HCD and gross domestic investment are positively related to economic growth in sub-regions economies. Conversely, migrate official remittance, portfolio investments and external debts are negatively related to economic growth.Research limitations/implicationsThe authors recommend that sound economic policies should be targeted in encouraging foreign capital accumulation and HCD, especially on FDI, official development assistance that exerts a positive impact on the economic growth of the sub-region. Therefore, training is required to prepare the labor force to work with new technologies and promote efficient enterprise for ECOWAS economies to compete with developed countries and emerging economies.Social implicationsThis study argued that the development of human capital is a pathway that may lead countries away from sustained growth. In the context of any economy which lack well-developed capital and education markets, many otherwise qualified citizens may be denied the basic skills they need in order to contribute fully to the nation’s economic development. HCD would encourage foreign investments, resulting in reduction in poverty in ECOWAS countries.Originality/valueSeveral studies have been done on foreign capital inflow and economic growth nexus such as Orjiet al.(2014), Ajide and Raheem (2016), Musibauet al.(2017), etc.; however, none of the research studies has actually examined the effect of the relationship between foreign capital inflows and HCD on economic growth in ECOWAS countries. This study is designed to fill the vacuum.

Foreign capital inflows and economic growth: the experience of low-income countries in Sub Saharan Africa

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Atif Awad
Keyword(s):  
Low Income ◽  
Foreign Capital ◽  
Ordinary Least Squares ◽  
Capital Inflows ◽  
Sub Saharan Africa ◽  
Low Income Countries ◽  
Content Type ◽  
Long Run ◽  
Foreign Capital Inflows ◽  
The Impact

Purpose This paper aims to investigate the long-run impact of selected foreign capital inflows, including aid, remittances, foreign direct investment (FDI), trade and debt, on the economic growth of 21 low-income countries in the Sub Saharan Africa (SSA) region, during the period 1990–2018. Design/methodology/approach To obtain this objective and for robust analysis, a parametric approach, which was dynamic ordinary least squares, and a non-parametric technique, which was fully modified ordinary least squares, were used. Findings The results of both models confirmed that, in the long run, trade and aid affected the growth rate of the per capita income in these countries in a positive way. However, external debt seemed to have an adverse influence on such growth. Originality/value First, this is the initial study that has addressed this matter across a homogenous group of countries in the SSA region. Second, while most of the previous studies regarding capital inflows into the SSA region have focused on the impact of only one or two aspects of such foreign capital inflows on growth, the present study, instead, examined the impact of five types of foreign capital inflows (aid, remittances, FDI, trade and debt).

Interest rate liberalization and economic growth nexus: does corruption matter?

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Abdulhadi Aliyara Haruna ◽  
Abu Sufian Abu Bakar
Keyword(s):  
Economic Growth ◽  
Interest Rate ◽  
Positive Impact ◽  
Reform Process ◽  
Negative Effects ◽  
African Countries ◽  
Cross Sectional ◽  
Content Type ◽  
Interest Rate Liberalization ◽  
The Impact

Purpose This paper aims to examine the impact of interest rate liberalization on economic growth and the relevance of corruption in the five selected sub-Saharan African countries. Design/methodology/approach The study used the modified version of Driscoll and Kraay’s model by Hoechle, which solved the effects of cross-sectional dependence and heteroscedasticity. Findings The findings reveal a positive impact of the index on economic growth, and it was found that foreign direct investment (FDI) and credit to private sector by banks (CPSB) all stimulate economic growth. The interaction terms of corruption with FDI and CPSB indicate negative effects that show how corruption erodes the benefits of liberalization. Finally, the paper recommends the pursuit of appropriate policies with the sole aim of eradicating corruption and providing a conducive environment for business. Originality/value The paper developed a composite domestic financial liberalization index to capture the timing and essential dimensions of the reform process. The study investigates the effect of interest rate liberalization on economic growth and the relevance of corruption. Most of the recent and past studies only examined the impact of interest rate reforms on growth without investigating the relevance of corruption.

scholarly journals Economic growth effect of private capital inflows: a structural VAR approach for Nigeria

2019 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Friday Osemenshan Anetor
Keyword(s):  
Economic Growth ◽  
Forecast Error ◽  
Research Result ◽  
Structural Var ◽  
Capital Inflows ◽  
Growth Effect ◽  
Private Capital ◽  
Portfolio Investment ◽  
Content Type ◽  
The Government

Purpose The purpose of this paper is to examine the effect of shocks in the various components of private capital inflows on economic growth in Nigeria using quarterly data in the period 1986Q1–2016Q4. Design/methodology/approach The study employs the impulse response function and the forecast error variance decomposition of the structural vector autoregression (SVAR) model. Findings The research result shows that shocks in foreign direct investment (FDI) inflows and portfolio investment inflows have a positive and significant impact on economic growth in Nigeria. In addition, FDIs accounted for significant variation in the growth of the Nigerian economy followed by portfolio investments, while personal remittances exerted the least variation in growth. Practical implications The government should promote a favorable macroeconomic environment for existing and potential foreign investors to ensure the continued inflows of FDI and portfolio investment. Originality/value The novelty of this study lies in disaggregating private capital inflows and analyzing the effect of the shock of each component on the growth of the Nigerian economy using SVAR.

Effect of economic growth, trade openness, urbanization, and technology on environment of Asian emerging economies

2018 ◽  
Vol 29 (6) ◽  
pp. 1123-1134 ◽  
Author(s):  
Kashif Munir ◽  
Ayesha Ameer
Keyword(s):  
Economic Growth ◽  
Emerging Economies ◽  
New Technologies ◽  
Trade Openness ◽  
Kuznets Curve ◽  
Stirpat Model ◽  
Causality Test ◽  
Content Type ◽  
Long Run ◽  
Short Run

Purpose The purpose of this paper is to analyze the long-run as well as short-run effect of economic growth, trade openness, urbanization and technology on environmental degradation (sulfur dioxide (SO2) emissions) in Asian emerging economies. Design/methodology/approach The study utilizes the augmented STIRPAT model and uses the panel cointegration and causality test to analyze the long-run and short-run relationships. Due to the unavailability of data for all Asian emerging economies, the study focuses on 11 countries, i.e. Bangladesh, Hong Kong, India, Indonesia, Iran, Malaysia, Pakistan, Philippines, Singapore, Sri Lanka and Thailand, and uses balance panel from 1980 to 2014 at annual frequency. Findings Results showed that the inverted U-shape hypothesis of the environmental Kuznets curve holds between economic growth and SO2 emissions. While technology and trade openness increases SO2 emissions, urbanization reduces SO2 emissions in Asian emerging economies in the long run. Unidirectional causality flows from urbanization to SO2 emissions and from SO2 emissions to economic growth in the short run. Practical implications Research and development centers and programs are required at the government and private levels to control pollution through new technologies as well as to encourage the use of disposed-off waste as a source of energy which results in lower dependency on fossil fuels and leads to reduce emissions. Originality/value This study contributes to the existing literature by analyzing the effects of urbanization, economic growth, technology and trade openness on environmental pollution (measured by SO2 emissions) in Asian emerging economies. This study provides the essential evidence, information and better understanding to key stakeholders of environment. The findings of this study are useful for individuals, corporate bodies, environmentalist, researchers and government agencies at large.

Sign in / Sign up

Export Citation Format

Share Document