Impact of foreign direct investment on greenhouse gas emissions in agriculture of developing countries

Abstract

This research analyses the impact of foreign direct investment on greenhouse gas emissions in the agriculture sector of developing countries. Panel data from 63 developing countries for the period 2005 to 2014 was used to estimate a dynamic econometric model by applying a system‐generalised method of moments. The empirical results indicate a positive impact of foreign direct investment in agriculture on the carbon dioxide equivalent emission intensity in developing countries. The results provide weak support for the pollution havens hypothesis and imply the importance of coordination between foreign direct investment and environmental policies.

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