IDEAS home Printed from https://ideas.repec.org/a/cii/cepiie/2020-q4-164-4.html
   My bibliography  Save this article

Understanding how foreign direct investment inflows impact urbanization in Africa

Author

Listed:
  • Carl Grekou
  • Ferdinand Owoundi

Abstract

This paper investigates the relationship between FDIs inflows and urbanization in Africa. To improve on the existing literature, we look beyond the conventional definition of urbanization based only on the number of people living in urban areas. Our broader approach includes both the amount of CO2 emissions in urban areas and the value addition of services. Relying on a large sample of African countries, we find FDIs inflows to have significantly influenced the momentum of urbanization on the continent, irrespective of the proxy for urbanization. Resource-seeking FDIs seems to be more responsible for this phenomenon than the market-seeking ones, implying that FDIs are detrimental to the environment, especially when the quality of institutions is low. These results suggest that African governments should enhance smart, sustainable policies to attract more market-seeking FDI while mitigating detrimental effects on the environment.

Suggested Citation

  • Carl Grekou & Ferdinand Owoundi, 2020. "Understanding how foreign direct investment inflows impact urbanization in Africa," International Economics, CEPII research center, issue 164, pages 48-68.
    • Handle: RePEc:cii:cepiie:2020-q4-164-4
    as

    Download full text from publisher

    File URL: https://www.sciencedirect.com/science/article/pii/S2110701720302511
    Download Restriction: no
    ---><---

    Citations

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


    Cited by:

    1. Omar Abu Risha & Qingshi Wang & Mohammed Ismail Alhussam, 2023. "Impact of Foreign Enterprises’ Capital Inflow on Urbanization Factors: Evidence from Northeastern Cities of China," Sustainability, MDPI, vol. 15(21), pages 1-24, November.

    More about this item

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • P25 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Urban, Rural, and Regional Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cii:cepiie:2020-q4-164-4. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/cepiifr.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.