Foreign Direct Investment, Technological Innovations, Energy Use, Economic Growth, and Environmental Sustainability Nexus: New Perspectives in BRICS Economies

Abdul Rauf, Najabat Ali, Muhammad Nauman Sadiq, Saira Abid, Shahzad Afzal Kayani and Abid Hussain
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Abdul Rauf: School of Management Science and Engineering, Nanjing University of Information Science and Technology, Nanjing 210044, China
Muhammad Nauman Sadiq: Faculty of Management Sciences, Hamdard University, Islamabad 45550, Pakistan
Saira Abid: School of Public Administration, Hohai University, Nanjing 210098, China
Shahzad Afzal Kayani: Faculty of Management Sciences, Hamdard University, Islamabad 45550, Pakistan
Abid Hussain: Department of Commerce, Thal University, Bhakkar 30000, Pakistan

Sustainability, 2023, vol. 15, issue 18, 1-18

Abstract: In the current era, economic growth is inevitable for global prosperity but achieving sustainable economic development is one of the significant challenges for the developing world. The present study explores the impacts of foreign direct investment, energy use, and technological innovations on the economic growth and environmental quality of BRICS countries for the period 1990–2018. We used the augmented mean group (AMG), the common correlated effects mean group estimator (CCEMG), and several other modern-day empirical techniques to analyze data. The findings show that foreign direct investment increases economic growth but harms the environmental sustainability of BRICS countries. Moreover, we have seen that energy use is directly proportional to economic growth and CO 2 emissions. This confirms that energy use is one of the factors which harms the environmental quality in BRICS economies. Likewise, economic growth increases CO 2 emissions. On the other hand, technology innovation has a direct relationship with economic growth but an inverse relationship with CO 2 emissions as it improves the environmental sustainability of the BRICS region. This research adds to the existing literature by exploring the interplay between FDI, innovation, energy use, economic growth, and environmental outcomes in the context of major emerging economies. The study’s findings provide empirical evidence on the role of these factors in shaping the environmental outcomes in the BRICS economies, and they have implications for policymakers and stakeholders in addressing environmental challenges such as global warming and climate change.

Keywords: foreign direct investment; technological innovation; energy use; economic growth; environmental quality; BRICS (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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