IDEAS home Printed from https://ideas.repec.org/p/ira/wpaper/202424.html

Technological Content and Institutional Quality of FDI: Investigating the effects on the environment in Brazil

Author

Listed:
  • Eduardo Polloni-Silva

    (Universidade Federal de Mato Grosso do Sul: Três Lagoas, Mato Grosso do Sul, Brazil.)

  • Herick Fernando Moralles

    (Industrial Engineering Department, Universidade Federal de São Carlos, Brazil.)

  • Rosina Moreno

    (AQR-IREA, Universitat de Barcelona, Spain.)

Abstract

Research shows that Foreign Direct Investment (FDI) can be beneficial/harmful to the host’s environment. However, the mechanisms that explain these contrasting effects are still unclear. By employing a regional dataset on FDI in the State of Sao Paulo, Brazil, this study verifies how the technological content of the FDI may impact the host region. Additionally, applying the promises from the institution-based view, the origins of FDI and the institutional quality of these home countries were included. The results reject the commonly employed ‘one size fits all’ approach towards FDI, since both high-technology and low-technology FDI can be beneficial for the host’s sustainable development. Yet, the origins of these investments matter, and receiving FDI from countries with weaker institutions can be harmful, regardless of the sector. These findings have important implications for policymakers and future research focused on emerging economies, and the promised expectations of FDI should be revisited.

Suggested Citation

  • Eduardo Polloni-Silva & Herick Fernando Moralles & Rosina Moreno, 2024. "Technological Content and Institutional Quality of FDI: Investigating the effects on the environment in Brazil," IREA Working Papers 202424, University of Barcelona, Research Institute of Applied Economics, revised Feb 2024.
    • Handle: RePEc:ira:wpaper:202424
    as

    Download full text from publisher

    File URL: http://www.ub.edu/irea/working_papers/2024/202424.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Yi Feng & Zhijun Gao & Wanjun Jiang, 2018. "What attracts China’s contracts to Latin America and the Caribbean? An empirical study of the determinants of Chinese contracts," Economic and Political Studies, Taylor & Francis Journals, vol. 6(1), pages 91-117, January.
    2. Doytch, Nadia & Uctum, Merih, 2016. "Globalization and the environmental impact of sectoral FDI," Economic Systems, Elsevier, vol. 40(4), pages 582-594.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Eduardo Polloni-Silva & Herick Fernando Moralles & Rosina Moreno, 2024. "“Technological Content and Institutional Quality of FDI: Investigating the effects on the environment in Brazil”," AQR Working Papers 202410, University of Barcelona, Regional Quantitative Analysis Group, revised Mar 2025.
    2. Eduardo Polloni-Silva & Guilherme Augusto Roiz & Enzo Barberio Mariano & Herick Fernando Moralles & Daisy Aparecida Nascimento Rebelatto, 2022. "The Environmental Cost of Attracting FDI: An Empirical Investigation in Brazil," Sustainability, MDPI, vol. 14(8), pages 1-14, April.
    3. Doytch, Nadia & Elheddad, Mohamed & Perez-Sebastian, Fidel, 2025. "Corrigendum to “New climate policy, resource abundance, and sectoral FDI”," Energy Economics, Elsevier, vol. 147(C).
    4. Guangxiong Mao & Wei Jin & Ying Zhu & Yanjun Mao & Wei-Ling Hsu & Hsin-Lung Liu, 2021. "Environmental Pollution Effects of Regional Industrial Transfer Illustrated with Jiangsu, China," Sustainability, MDPI, vol. 13(21), pages 1-19, November.
    5. Ofori, Isaac K. & Figari, Francesco, 2022. "Economic Globalisation and Inclusive Green Growth in Africa: Contingencies and Policy-Relevant Thresholds of Governance," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, issue Forthcomi, pages 1-1.
    6. Ahmad Zomorrodi & Xiaoyan Zhou, 2016. "Role of EKC and PHH in Determining Environment Quality and their Relation to Economic Growth of a Country," Asian Journal of Economics and Empirical Research, Asian Online Journal Publishing Group, vol. 3(2), pages 139-144.
    7. Obadiah I. Damak & Hasan Güngör, 2025. "The effects of rule of law, regulatory quality, and R&D on Japan's environmental sustainability," Sustainable Development, John Wiley & Sons, Ltd., vol. 33(2), pages 2278-2291, April.
    8. AhAtil, Ahmed & Bouheni, Faten Ben & Lahiani, Amine & Shahbaz, Muhammad, 2019. "Factors influencing CO2 Emission in China: A Nonlinear Autoregressive Distributed Lags Investigation," MPRA Paper 91190, University Library of Munich, Germany, revised 02 Jan 2019.
    9. Sung, Bongsuk & Song, Woo-Yong & Park, Sang-Do, 2018. "How foreign direct investment affects CO2 emission levels in the Chinese manufacturing industry: Evidence from panel data," Economic Systems, Elsevier, vol. 42(2), pages 320-331.
    10. Alex O. Acheampong, 2022. "The impact of de facto globalization on carbon emissions: Evidence from Ghana," International Economics, CEPII research center, issue 170, pages 156-173.
    11. Owusu, Solomon & Tang, Keyi & Ndubuisi, Gideon, 2025. "Chinese ties and low carbon industrialization in Africa," Energy Economics, Elsevier, vol. 144(C).
    12. Feng Zhao & Yinyin Zhang & Majed Alharthi & Muhammad Wasif Zafar, 2022. "Environmental sustainability in developing countries: Understanding the criticality of financial inclusion and globalization," Sustainable Development, John Wiley & Sons, Ltd., vol. 30(6), pages 1823-1837, December.
    13. Ofori, Isaac K. & Gbolonyo, Emmanuel Y. & Ojong, Nathanael, 2022. "Foreign Direct Investment and Inclusive Green Growth in Africa: Energy Efficiency Contingencies and Thresholds," MPRA Paper 115379, University Library of Munich, Germany, revised 09 Nov 2022.
    14. Musarat Abbas & Ling Yang & Michael L. Lahr, 2024. "Globalization’s effects on South Asia’s carbon emissions, 1996–2019: a multidimensional panel data perspective via FGLS," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 11(1), pages 1-19, December.
    15. Waseem Akhter & Khalid Zaman & Abdelmohsen A. Nassani & Muhammad Moinuddin Qazi Abro, 2020. "Nexus between natural and technical disaster shocks, resource depletion and growth-specific factors: evidence from quantile regression," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 104(1), pages 143-169, October.
    16. Hille, Erik & Shahbaz, Muhammad & Moosa, Imad, 2019. "The impact of FDI on regional air pollution in the Republic of Korea: A way ahead to achieve the green growth strategy?," Energy Economics, Elsevier, vol. 81(C), pages 308-326.
    17. Peng Zhang & Maosheng Duan & Guangzhi Yin, 2018. "The Periodic Characteristics of China’s Economic Carbon Intensity Change and the Impacts of Economic Transformation," Energies, MDPI, vol. 11(4), pages 1-21, April.
    18. Mehdi Abid & Zouheyr Gheraia & Habib Sekrafi & Hanane Abdelli, 2024. "Air Pollution and Economic Development in KSA: Environmental Kuznets Curve and Implications for Sustainable Development," International Journal of Energy Economics and Policy, Econjournals, vol. 14(1), pages 628-639, January.
    19. Canh Phuc Nguyen & Thanh Dinh Su, 2021. "Financing the economy: The multidimensional influences of financial development on economic complexity," Journal of International Development, John Wiley & Sons, Ltd., vol. 33(4), pages 644-684, May.
    20. Demena, Binyam Afewerk & Afesorgbor, Sylvanus Kwaku, 2020. "The effect of FDI on environmental emissions: Evidence from a meta-analysis," Energy Policy, Elsevier, vol. 138(C).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • F18 - International Economics - - Trade - - - Trade and Environment
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:ira:wpaper:202424. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc 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 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: Alicia García (email available below). General contact details of provider: https://edirc.repec.org/data/feubaes.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.