The Impact of FDI on CO 2 Emissions in Latin America

Luisa Blanco, Fidel Gonzalez and Isabel Ruiz ()

Oxford Development Studies, 2013, vol. 41, issue 1, 104-121

Abstract: This paper uses panel Granger causality tests to study the relationship between sector-specific foreign direct investment (FDI) and CO 2 emissions. Using a sample of 18 Latin American countries for the period 1980--2007, we find causality running from FDI in pollution-intensive industries (“the dirty sector”) to CO 2 emissions per capita. This result is robust to controlling for other factors associated with CO 2 emissions and using the ratio of CO 2 emissions to GDP. For other sectors, we find no robust evidence that FDI causes CO 2 emissions.

Date: 2013
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DOI: 10.1080/13600818.2012.732055

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