Advanced Search
MyIDEAS: Login to save this article or follow this journal

Energy savings via FDI? Empirical evidence from developing countries

Contents:

Author Info

  • HÜBLER, MICHAEL
  • KELLER, ANDREAS

Abstract

In this paper we examine the influence of foreign direct investment inflows on energy intensities of developing countries empirically. We first show that a simple OLS estimation, as it is found in the literature, suggests energy intensity reductions from FDI inflows, which is consistent with the hypothesis of energy saving technology transfer via FDI. However, such a regression turns out to be spurious and only a starting point for further research. Therefore, we use macro level data on 60 developing countries for the period 1975-2004 including other potential determinants of energy intensities and apply panel estimation techniques and tests. The results do not confirm the hypothesis that FDI inflows reduce energy intensities of developing countries in general. Interactions of FDI with country-specific characteristics do not show significant effects, either.

(This abstract was borrowed from another version of this item.)

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://journals.cambridge.org/abstract_S1355770X09990088
File Function: link to article abstract page
Download Restriction: no

Bibliographic Info

Article provided by Cambridge University Press in its journal Environment and Development Economics.

Volume (Year): 15 (2010)
Issue (Month): 01 (February)
Pages: 59-80

as in new window
Handle: RePEc:cup:endeec:v:15:y:2010:i:01:p:59-80_99

Contact details of provider:
Postal: The Edinburgh Building, Shaftesbury Road, Cambridge CB2 2RU UK
Fax: +44 (0)1223 325150
Web page: http://journals.cambridge.org/jid_EDEProvider-Email:journals@cambridge.org

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Eskeland, Gunnar S. & Harrison, Ann E., 1997. "Moving to greener pastures : multinationals and the pollution-haven hypothesis," Policy Research Working Paper Series 1744, The World Bank.
  2. Szroeter, Jerzy, 1978. "A Class of Parametric Tests for Heteroscedasticity in Linear Econometric Models X1-ab," Econometrica, Econometric Society, vol. 46(6), pages 1311-27, November.
  3. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-38, May.
  4. Choi, In, 2001. "Unit root tests for panel data," Journal of International Money and Finance, Elsevier, vol. 20(2), pages 249-272, April.
  5. Massimiliano Mazzanti & Antonio Musolesi & Roberto Zoboli, 2006. "A Bayesian Approach to the Estimation of Environmental Kuznets Curves for CO2 Emissions," Working Papers 2006.121, Fondazione Eni Enrico Mattei.
  6. Manuel Agosin & Roberto Machado, 2005. "Foreign Investment in Developing Countries: Does it Crowd in Domestic Investment?," Oxford Development Studies, Taylor & Francis Journals, vol. 33(2), pages 149-162.
  7. David I. Stern, 2003. "The Rise and Fall of the Environmental Kuznets Curve," Rensselaer Working Papers in Economics 0302, Rensselaer Polytechnic Institute, Department of Economics.
  8. David M. Drukker, 2003. "Testing for serial correlation in linear panel-data models," Stata Journal, StataCorp LP, vol. 3(2), pages 168-177, June.
  9. Granger, C. W. J. & Newbold, P., 1974. "Spurious regressions in econometrics," Journal of Econometrics, Elsevier, vol. 2(2), pages 111-120, July.
  10. Kamal Saggi, 2002. "Trade, Foreign Direct Investment, and International Technology Transfer: A Survey," World Bank Research Observer, World Bank Group, vol. 17(2), pages 191-235, September.
  11. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-72, June.
  12. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
  13. Werner Antweiler & Brian R. Copeland & M. Scott Taylor, 2001. "Is Free Trade Good for the Environment?," American Economic Review, American Economic Association, vol. 91(4), pages 877-908, September.
  14. Pasaran, M.H. & Im, K.S. & Shin, Y., 1995. "Testing for Unit Roots in Heterogeneous Panels," Cambridge Working Papers in Economics 9526, Faculty of Economics, University of Cambridge.
  15. Fisher-Vanden, Karen & Jefferson, Gary H. & Liu, Hongmei & Tao, Quan, 2004. "What is driving China's decline in energy intensity?," Resource and Energy Economics, Elsevier, vol. 26(1), pages 77-97, March.
  16. Roger Perman & David I. Stern, 2003. "Evidence from panel unit root and cointegration tests that the Environmental Kuznets Curve does not exist," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 47(3), pages 325-347, 09.
  17. Cole, Matthew A., 2006. "Does trade liberalization increase national energy use?," Economics Letters, Elsevier, vol. 92(1), pages 108-112, July.
  18. G. Corcos & M. Del Gatto & G. Mion & GIP. Ottaviano, 2007. "Productivity and Firm Selection: Intra- vs International Trade," Working Paper CRENoS 200706, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  19. Maddala, G S & Wu, Shaowen, 1999. " A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 631-52, Special I.
  20. Rossana Galli, 1998. "The Relationship Between Energy Intensity and Income Levels: Forecasting Long Term Energy Demand in Asian Emerging Countries," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 85-105.
  21. Mielnik, Otavio & Goldemberg, Jose, 2002. "Foreign direct investment and decoupling between energy and gross domestic product in developing countries," Energy Policy, Elsevier, vol. 30(2), pages 87-89, January.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Angelo Antoci & Paolo Russu & Elisa Ticci, 2011. "Investement inflows and sustainable development in a natural resource-dependent economy," Department of Economic Policy, Finance and Development (DEPFID) University of Siena 0311, Department of Economic Policy, Finance and Development (DEPFID), University of Siena.
  2. Hübler, Michael, 2011. "Technology diffusion under contraction and convergence: A CGE analysis of China," Energy Economics, Elsevier, vol. 33(1), pages 131-142, January.
  3. Bento Cerdeira, João Paulo, 2012. "The role of foreign direct investment in the renewable electricity generation and economic growth nexus in Portugal: a cointegration and causality analysis," MPRA Paper 41533, University Library of Munich, Germany.
  4. Hübler, Michael & Pothen, Frank, 2013. "The optimal tariff in the presence of trade-induced productivity gains," ZEW Discussion Papers 13-103, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  5. Richard Perkins & Eric Neumayer, 2012. "Do recipient country characteristics affect international spillovers of CO 2-efficiency via trade and foreign direct investment?," Climatic Change, Springer, vol. 112(2), pages 469-491, May.
  6. Richard Perkins & Eric Neumayer, 2009. "How do domestic attributes affect international spillovers of CO2-efficiency?," LSE Research Online Documents on Economics 37611, London School of Economics and Political Science, LSE Library.
  7. Michael Hübler & Alexander Glas, 2014. "The Energy-Bias of North–South Technology Spillovers: A Global, Bilateral, Bisectoral Trade Analysis," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 58(1), pages 59-89, May.
  8. Hamdi, Helmi & Sbia, Rashid & Shahbaz, Muhammad, 2014. "The nexus between electricity consumption and economic growth in Bahrain," Economic Modelling, Elsevier, vol. 38(C), pages 227-237.
  9. Deniz Erdem, 2012. "Foreign direct investments, energy efficiency, and innovation dynamics," Mineral Economics, Springer, vol. 24(2), pages 119-133, June.
  10. João Paulo Bento, 2011. "Energy Savings via Foreign Direct Investment? - Empirical evidence from Portugal," Working Papers 2011/24, Maastricht School of Management.
  11. Bettina Kretschmer & Michael Hübler & Peter Nunnenkamp, 2010. "Does Foreign Aid Reduce Energy and Carbon Intensities in Developing Countries," Kiel Working Papers 1598, Kiel Institute for the World Economy.
  12. Michael Hübler, 2009. "Energy Saving Technology Diffusion via FDI and Trade: A CGE Model of China," Kiel Working Papers 1479, Kiel Institute for the World Economy.
  13. Cerdeira Bento, João Paulo, 2012. "Cointegration Models Applied For Portugal’s Energy Consumption, Inward FDI and GDP Series (1980-2007)," MPRA Paper 41619, University Library of Munich, Germany.
  14. Pueyo, Ana & García, Rodrigo & Mendiluce, María & Morales, Darío, 2011. "The role of technology transfer for the development of a local wind component industry in Chile," Energy Policy, Elsevier, vol. 39(7), pages 4274-4283, July.
  15. Adom, Philip K. & Kwakwa, Paul Adjei, 2014. "Effects of changing trade structure and technical characteristics of the manufacturing sector on energy intensity in Ghana," Renewable and Sustainable Energy Reviews, Elsevier, vol. 35(C), pages 475-483.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:cup:endeec:v:15:y:2010:i:01:p:59-80_99. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Keith Waters).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.