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The Nexus of Foreign Direct Investment, Economic Growth and Environment in Pakistan

Syed Sundus Raza and Anwar Hussain
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Syed Sundus Raza: Visiting Faculty, Fatima Jinnah Women University, Rawalpindi
Anwar Hussain: Assistant Professor, Pakistan Institute of Development Economics, Islamabad

The Pakistan Development Review, 2016, vol. 55, issue 2, 95-111

Abstract: This paper estimate the impact of sectoral FDI on economic growth and carbon dioxide emissions in Pakistan. To this end, it uses time series secondary data from 1972 to 2011 and applies Auto Regressive Distributed Lag (ARDL) models. The results showed that FDI inflows in manufacturing, transport, storage and communication sectors and energy consumption have positive effect on the GDP growth of Pakistan. Besides, FDI inflow in manufacturing, transport, storage and communication sector and population density are responsible for the CO2 emissions in Pakistan. The results also validate Environmental Kuznet Curves in both long and short run.

Keywords: Sectoral FDI; CO2 emissions; Environmental Kuznet Curves; Gross Domestic Product Growth (search for similar items in EconPapers)
JEL-codes: E2 O4 Q5 (search for similar items in EconPapers)
Date: 2016
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