Effect of foreign direct investment on CO 2 emission with the role of globalization, institutional quality with pooled m
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RESEARCH ARTICLE
Effect of foreign direct investment on CO2 emission with the role of globalization, institutional quality with pooled mean group panel ARDL Jian-Zhou Teng 1,2 & Muhammad Kamran Khan 1 Muhammad Owais Khan 4
&
Muhammad Imran Khan 1 & Muhammad Zubair Chishti 3 &
Received: 21 July 2020 / Accepted: 10 September 2020 # Springer-Verlag GmbH Germany, part of Springer Nature 2020
Abstract This study utilized the Pooled Mean Group estimator to investigate the effect of renewable energy consumption, electricity consumption, economic growth, institutional quality, and globalization on carbon dioxide emission with an updated dataset for 10 economies for the time period from 1985 to 2018. Results of Harris-Tzavalis’s test and Levin–Lin–Chu’s test show that the utilized regressand and regressors are stationary at I(0) and I(I) that conform that the pooled mean group estimator panel ARDL can be utilized. Results of Kao and Pedroni cointegration tests show that cointegration exists amongst the variables. Empirical results of pooled mean group (PMG) revealed that renewable energy consumption helps to diminish the environmental degradation while foreign direct investment, electricity consumption, and economic growth and institutional quality positively affect the degradation of the environment. The findings show that globalization in the long run adversely and significantly influences the environmental degradation; globalization reduces the environmental degradation in the long run while in the short run, globalization positively and significantly influences the environmental degradation. Results of the panel VAR and VECM model indicate electricity consumption and institutional quality, and globalization positively affects environmental degradation. Further policies are recommended based on the findings. Keywords Foreign direct investment . Energy consumption . Economic growth . Institutional quality . Globalization . Environmental degradation
Jian-Zhou Teng and Muhammad Kamran Khan contributed equally to this work. Responsible editor: Nicholas Apergis * Muhammad Kamran Khan [email protected]
1
School of Economics and Management, Northeast Normal University, Changchun, Jilin, China
2
School of Mathematics and Statistics, Key laboratory for Applied Statistics of MOE (KLAS), Northeast Normal University, Changchun, Jilin, China
Muhammad Imran Khan [email protected]
3
Muhammad Zubair Chishti [email protected]
School of Economics, Quaid-I-Azam University, Islamabad, Pakistan
4
Center for Agricultural Resources Research, Institute of Genetics and Developmental Biology, Chinese Academy of Sciences, Beijing, China
Jian-Zhou Teng [email protected]
Muhammad Owais Khan [email protected]
Environ Sci Pollut Res
Introduction Greenhouse gas emission destroys the environment both in developed and developing economies around the world, and the statement that pollution is the only main problem of developed countries is not practically effective. Environmental degradation due to the gr
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