Tackling the ecological footprints of foreign direct investment and energy dependency through governance: empirical evidence from GCC region

Mosab I. Tabash (), Umar Farooq, Ghaleb A. El Refae () and Abdelhafid Belarbi ()
Additional contact information
Mosab I. Tabash: Al Ain University
Ghaleb A. El Refae: Al Ain University
Abdelhafid Belarbi: Al Ain University

Quality & Quantity: International Journal of Methodology, 2023, vol. 57, issue 5, No 24, 4435-4454

Abstract: Abstract Due to more focus on environmental sustainability, the topic of environmental pollution has become much prominent among the academic community and policy officials. In this regard, the role of foreign direct investment and dependency on diverse energy sources in determining CO2 emissions is undeniable. Considering this, the current study attempts to empirically explore the association among foreign direct investment, energy dependency, and CO2 emissions in the GCC region. This study further examines the moderating effect of the governance system in the energy dependency-CO2 emissions liaison. We use a large range of data spanning from 1996 to 2019 and employ FMOLS (fully modified ordinary least square) techniques to test the suggested relationship. The empirical analysis discovered an inverse connection between foreign direct investment and CO2 emissions while a direct association between consumption of non-renewable energy sources and CO2 emissions. Additionally, the moderating role of a better governance system in alienating the adverse impacts of non-renewable energy consumption was observed. The inflow of FDI can reduce CO2 emissions by facilitating the development of modern technology. Similarly, a better governance system can mitigate the adverse impacts of non-renewable energy by enhancing energy efficiency and energy management. The empirical analysis supports the pollution halo hypothesis in the GCC region and recommends various policies. The policy officials should do more focus on exercising a better governance system. They should also enhance the volume of FDI inflow through multiple policy facilitations.

Keywords: Foreign direct investment; Energy consumption; CO2 emissions; Governance system; GCC region; Pollution halo hypothesis (search for similar items in EconPapers)
JEL-codes: F21 G38 Q53 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://link.springer.com/10.1007/s11135-022-01534-2 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:qualqt:v:57:y:2023:i:5:d:10.1007_s11135-022-01534-2

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/11135

DOI: 10.1007/s11135-022-01534-2

Access Statistics for this article

Quality & Quantity: International Journal of Methodology is currently edited by Vittorio Capecchi

More articles in Quality & Quantity: International Journal of Methodology from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().