The past decade has seen a trend of accelerating environmental degradation such as increasing greenhouse gas emissions, deforestation and loss of biodiversity. Such patterns of environmental destruction have been driven by increased economic activity, of which Foreign Direct Investment (FDI) has become an increasingly significant contributor. Governments have removed many restrictions on trade and eased environmental rules in developing countries, leading multinationals to flock in and take advantage of these liberalized trade rules. The question is posed as to whether this process is more of a threat for countries which accept FDI or not. The present paper tests the pollution haven hypothesis by employing a panel data on FDI inflows in five Asian countries for the period from 1990 to 2011. Results show support for the idea that investors favor lax environmental regulation when making FDI location decisions and also suggest the validity of Environmental Kuznets Curve (EKC) hypothesis.
کلید واژگان :Key words: foreign direct investment, pollution haven hypothesis, environmental degradation, Environmental Kuznets Curve, panel data analysis
ارزش ریالی : 600000 ریال
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