Effect of Foreign Direct Investment on Energy consumption: Does Institutional Quality matter? Evidence from Cote d Ivoire

Lewis Gakpa and Hugues Kouadio

International Journal of Energy Economics and Policy, 2022, vol. 12, issue 1, 453-459

Abstract: This paper examines the role played by institutional quality in the relationship between foreign direct investment and energy consumption in C te d Ivoire. Using data from the World Bank and International Country Risk Guid over the period 1984-2014 and the Dynamic Ordinary Least Squares (DOLS) and Fully Modified Ordinary Least Squares (FMOLS) methods, we account for the joint effects of institutional quality and foreign direct investment on energy consumption. The results reveal that a high level of democracy attenuates the negative effects of FDI flows on energy consumption. This result shows that improving and strengthening democratic institutions has a positive influence on energy efficiency incentive policies by changing the composition of FDI towards clean technology sectors, such as the service sector.

Keywords: FDI; Energy Consumption; Institutional Quality; Cote d Ivoire (search for similar items in EconPapers)
JEL-codes: C32 E02 F21 O13 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eco:journ2:2022-01-57

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