The Disproportional Impact of Foreign Direct Investment, Carbon Dioxide Emissions and Economic Growth: Empirical Evidence from Vietnam

Vo Dai Hai Le () and Thi Thuy Hang Le ()
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Vo Dai Hai Le: University of Finance - Marketing, Vietnam
Thi Thuy Hang Le: University of Finance - Marketing, Vietnam

International Journal of Energy Economics and Policy, 2025, vol. 15, issue 4, 401-410

Abstract: The study analyzes issues related to foreign direct investment flows into Vietnam, Vietnam's CO2 emissions and their positive and negative impacts on the growth rate of the Vietnamese economy in the period from 1986 to 2023. This study not only provides empirical evidence on the relationship between environmental pollution, foreign direct investment and economic growth, but also uses the NARDL model to test the asymmetric impact of foreign investment flows on environmental pollution and economic growth in Vietnam. Specifically, the research results show that there is an asymmetric impact of foreign direct investment flows into Vietnam, CO2 emissions into the environment and the level of economic development. This capital flow includes both positive and negative impacts on long-term economic performance, reflecting changes in two different directions. When foreign direct investment flows increase by 1%, the economy tends to improve with an increase of 0.18%. On the contrary, when capital flows decrease by 1%, the economy is negatively affected with a decrease of 0.46% after a lag period. The results of this study are the basis for making recommendations for planning policies related to the environment, economic growth and attracting investment capital effectively.

Keywords: Foreign Direct Investment; Carbon Dioxide Emissions; Economic Growth; NARDL; Vietnam (search for similar items in EconPapers)
Date: 2025
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DOI: 10.32479/ijeep.19633

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