scholarly journals Panel Data Analysis on the Influence of Environmental Regulations on the Inflow of Foreign Direct Investment in China

2020 ◽  
Vol 15 (7) ◽  
pp. 1035-1044
Author(s):  
Hao Hu ◽  
Lei Dong ◽  
Hao Zhang ◽  
Haiyan Tang ◽  
Desheng Yin
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Fixed Effects ◽  
Environmental Regulations ◽  
Panel Data Analysis ◽  
Entropy Method ◽  
Eastern Region ◽  
Fixed Effects Model ◽  
Location Selection ◽  
Investment In China

From the micro level, this paper thoroughly investigates the influence of environmental regulations (ERS) on the inflow of foreign direct investment (FDI) in China. Firstly, the entropy method was adopted to comprehensively measure the ERS intensities of 283 Chinese cities at prefecture level and above in 2003-2016. Then, the Cournot model was utilized to analyze how ERS affects FDI. After that, fixed-effects model was employed to empirically examine the impacts of ERS intensities in eastern, central, and western regions on FDI inflow. The results show that: The regression results on nationwide, central, and western samples indicate that the influence of ERS variable was significantly negative. This means ERS is indeed an important consideration of foreign investors in location selection. Besides, stricter ERS hinders the inflow of FDI, which agrees with the pollution haven hypothesis. On eastern samples, stricter ERS promotes FDI inflow, that is, the situation in eastern region meets Porter hypothesis. Finally, several suggestions were presented for policymakers based on the empirical results.

scholarly journals Effect of Precipitation on Location Choice of Foreign Direct Investment in China

Water ◽  
2021 ◽  
Vol 13 (23) ◽  
pp. 3417
Author(s):  
Zhiyuan Xu ◽  
Yuting Zhu ◽  
Yongliang Yang
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Eastern Region ◽  
Environmental Costs ◽  
Promoting Effect ◽  
Location Selection ◽  
Level Data ◽  
Low Degree ◽  
Location Adjustment ◽  
Investment In China

This paper studies the effect of precipitation on the location of foreign direct investment (FDI) based on city-level data of China from 2003 to 2018. The results show that precipitation has a significant promoting effect on the regional agglomeration of FDI. This indicates that FDI location selection is more inclined to use the dilution ability of precipitation for pollution to reduce environmental costs, rather than relying solely on water resources. Further analysis shows that the preference of FDI enterprises on precipitation in the eastern region is significantly lower than that in the central and northeastern regions. This reflects the trend that FDI enterprises gradually shift to regions with a low degree of environmental regulation to reduce environmental costs. Therefore, the efforts made by economically developed cities to improve the regional ecological environment may be offset by the location adjustment of FDI enterprises, and precipitation has become an important stimulus for the location transfer of FDI enterprises.

scholarly journals The Determinants of Foreign Direct Investment in China: A Spatial Panel Analysis

2016 ◽  
Author(s):  
Chen-Chen Yong ◽  
Siew-Yong Yew ◽  
Xin Huang ◽  
Mui-Yin Chin
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Eastern Region ◽  
Panel Analysis ◽  
Fdi Inflows ◽  
Spatial Panel ◽  
Panel Model ◽  
Spatial Panel Model ◽  
Investment In China ◽  
Determinants Of Fdi

China is currently the major foreign direct investment (FDI) destination arising from her open door policies since 1978. FDI has become a large impetus to China’s economic growth. However, the geographical distribution of FDI in China is severely biased with 83% concentrated in the eastern region. This is a result of not only differences in locational advantages but also the result of the initiating policies and temporal differences of FDI inflows among the regions. This study aims to examine the determinants of FDI and examine empirically the possible coherent policies for the three regions of China (Eastern, Central and Western) using the spatial panel analysis for the data within the period of 1994 to 2008. The empirical results show that the determinants of FDI vary among the three regions, depending on the motives of the investor and the results of policy bias. The entrepreneurial nature of competition of FDI among the provinces revealed by the spatial FDI factor is a conclusion that cannot be ignored. A more coherent policy on FDI inflows into China is an urgent necessity, though the policies for each region must be, of necessity, different for each of the three regions.   Keywords: Foreign Direct Investment, China, Spatial panel model, spatial variables JEL: F14, C33

A Panel Study of the Pollution-Haven Hypothesis

2009 ◽  
Vol 9 (1) ◽  
pp. 1850154 ◽  
Author(s):  
Raymond MacDermott
Keyword(s):  
Foreign Direct Investment ◽  
Interest Rates ◽  
Direct Investment ◽  
Fixed Effects ◽  
Environmental Regulations ◽  
Panel Study ◽  
Pollution Haven Hypothesis ◽  
Data Set ◽  
Pollution Haven ◽  
Pollution Emissions

This paper tests the pollution-haven hypothesis. A fixed-effects variation of the gravity model is applied to panel data to investigate what relationship, if any, exists between environmental regulations and FDI. The data set focuses on bilateral flows of aggregated foreign direct investment between 26 OECD countries from 1982 to 1997. Use of pollution emissions as a proxy for environmental stringency shows evidence in support of the pollution-haven hypothesis. In other words, firms do seek out countries with weaker environmental regulations for production. In addition, FDI appears to fall with distance. Contrary to expectations, FDI is not influenced by interest rates, wages or GDP.

scholarly journals Determinan Aliran Masuk Foreign Direct Investment ke Negara-Negara Berpendapatan Rendah

2020 ◽  
Vol 7 (2) ◽  
pp. 174-188
Author(s):  
Rully Aprianto ◽  
Alla Asmara ◽  
Sahara
Keyword(s):  
Foreign Direct Investment ◽  
Random Effects ◽  
Direct Investment ◽  
Fixed Effects ◽  
Fixed Effects Model ◽  
Model Data

Modal merupakan faktor penting yang mendorong pertumbuhan ekonomi dan pembangunan. Investasi asing langsung (foreign direct investment – FDI) adalah salah satu bentuk modal terbaik dalam pembiayaan dan investasi proyek industri. Oleh karena itu, adalah hal yang penting untuk mengidentifikasi faktor-faktor yang memengaruhi FDI dan untuk menentukan tingkat pengaruh masing-masing untuk membuat kebijakan yang tepat di bidang ini. Penelitian ini menganalisis faktor-faktor penentu FDI di negara dengan pendapatan per kapita rendah. Analisis didasarkan pada sampel dari 10 negara berpendapatan rendah. Dengan menggunakan model data panel, digunakan tiga pendekatan, yaitu common model, random effects dan fixed effects model, untuk mengidentifikasi faktor-faktor yang memengaruhi FDI di negara-negara ini. Hasil penelitian menunjukkan faktor-faktor yang berpengaruh secara signifikan terhadap aliran masuk FDI ke negara-negara dengan tingkat pendapatan rendah adalah PDB (ukuran pasar), inflasi, produktivitas tenaga kerja, infrastruktur, keterbukaan perdagangan, dan stabilitas politik. Sementara kualitas kebijakan dan peraturan tidak berpengaruh secara signifikan.

scholarly journals The Impact of Foreign Direct Investment in the Western Balkan Countries - A Panel Data Analysis

2021 ◽  
Vol 16 (6) ◽  
pp. 1185-1190
Author(s):  
Nexhat Shkodra ◽  
Xhevat Sopi ◽  
Florentina Xhelili Krasniqi
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Panel Data ◽  
Random Effects ◽  
Direct Investment ◽  
Fixed Effects ◽  
Panel Data Analysis ◽  
Random Effects Model ◽  
Balkan Countries ◽  
The Impact

Foreign Direct Investment (FDI) has a significant effect on the economic growth and development of host economies, but also on international economic integration through globalization. Particular aspects of this topic are being extensively addressed by scientific research in recent decades. The purpose of this paper is to determine whether globalization and through it the Foreign Direct Investment (FDI) has an impact on the economic growth (GDPgr) of the Western Balkan countries which are facing a transitional phase. The relation between FDI and economic growth has been analyzed by employing econometric models with panel data approach: linear regression with poled data, the Fixed Effects model, and the Random-Effects model (GLS). The study is based on panel data of six countries for the period between 2004-2018, obtained by the World Bank. The results of the Random Effects model (GLS) shown that lagged FDI has a significant impact on the economic growth (GDPgr) of the Western Balkans (p<0.05%), as well as gross capital formation (Cap) and government expenditure (Gov) whereas export (Ex) has been excluded from the model. The results also shown that there are significant differences in the factors influencing economic growth among countries in the region (LM Method - Breusch-Pagan test; p=0.02455 < 0.05).

scholarly journals The Impact of Foreign Direct Investment, Capital Formation, Inflation, Money Supply and Trade Openness on Economic Growth of Asian Countries

2020 ◽  
Vol 2 (1) ◽  
pp. 25-34
Author(s):  
Xiuyun Yang ◽  
Muhammad Nouman Shafiq
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Money Supply ◽  
Direct Investment ◽  
Fixed Effects ◽  
Trade Openness ◽  
Capital Formation ◽  
Fixed Effects Model ◽  
Asian Countries ◽  
The Impact

Economic growth is currently an essential phenomenon for emerging countries worldwide and has gained the researchers' intentions. Thus, the current study aims to examine the role of foreign direct investment (FDI), capital formation, inflation, money supply, and trade openness on the economic growth of Asian countries. The data has been extracted from the twenty emerging Asian countries from 2007 to 2018 using the most popular database named World Development Indicators (WDI). The fixed-effects model, along with the robust standard error, has been used for checking the impact of predictors on the economic growth of Asian countries. The results revealed that the predictors such as FDI, capital formation, money supply, and trade openness have positive association with economic growth, while inflation has a negative association with the economic growth of Asian countries. These findings are suitable for the new arrivals who want to examine this area in the future and for the regular traders who want to develop policies related to economic growth.

The Relationship Between Foreign Direct Investment and Financial Development in OECD Countries

2020 ◽  
pp. 206-226
Author(s):  
Metin Gürler ◽  
Funda Kara
Keyword(s):  
Foreign Direct Investment ◽  
Financial Development ◽  
Direct Investment ◽  
Fixed Effects ◽  
Oecd Countries ◽  
Fixed Effects Model ◽  
Causality Test ◽  
Section Data ◽  
Main Determinants ◽  
The Relationship

This chapter investigates the relationship between the OECD-FRRI issued by OECD and IMF-FDI issued by IMF for 36 OECD member countries. Cross-section data (CSD) analysis and panel data (PD) analysis consisting of random and fixed effects estimations were used in the study to investigate the relationship between Foreign Direct Investment (FDI) and Financial Development for OECD countries for the years 1997, 2003, and 2006 and the 7-year period of 2010-2016. Granger Causality Test (GCT) is also applied to test the direction of causality between two indicators. According to the Random Effects Model (RAM) and Fixed Effects Model (FEM) with PD analysis in the study OECD-FRRI is found as one of the determinants of IMF-FDI and IMF-FDI is found as one of the determinants of OECD-FRRI in OECD member countries. For CSD analysis, there is no significant proof to say OECD-FRRI is one of the main determinants of IMF-FDI and IMF-FDI is one of the determinants of OECD-FRRI in OECD member countries. For CSD, OECD-FRRI does not cause IMF-FDI whereas IMF-FDI causes OECD-FRRI.

The Effects of Information Technology Achievement and Diffusion on Foreign Direct Investment

2003 ◽  
Vol 2 (2) ◽  
pp. 161-178 ◽  
Author(s):  
Azmat Gani ◽  
Basu Sharma
Keyword(s):  
Foreign Direct Investment ◽  
Direct Investment ◽  
Fixed Effects ◽  
Unit Cost ◽  
Information And Communications Technology ◽  
Fixed Effects Model ◽  
New Information ◽  
High Degree ◽  
And Diffusion ◽  
Technological Achievement

AbstractForeign direct investment (FDI) and the new information and communications technology (ICT) have gained significant grounds in many parts of the world in somewhat parallel fashion. The objective of this paper is to assess the proposition that the level of technological achievement and diffusion is a determining factor in attracting FDI in high-income countries. A sample of technologically advanced countries was chosen on the basis of the technological achievement index (TAI). Crosscountry data for the period of 1994 to 1998 were used to estimate a fixed effects model. The empirical results obtained provide strong evidence that technology diffusion of new instruments of ICT, such as mobile phones and Internet hosts, are major pull factors of FDI. The results also provide evidence that robust economic environment, low unit cost, and high degree of openness are other essential determinants of FDI. We conclude that in order to retain and attract FDI, countries should create opportunities for useful innovations to be created and diffused, as well as maintain flexible, competitive and dynamic economic environments. The main policy implication for countries lagging in terms of attracting foreign investment is to build on reforms that emphasize creation and diffusion of ideas and products, as well as maintain a high degree of openness to new investors, especially in ICT.

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