Journal
JOURNAL OF ENVIRONMENTAL MANAGEMENT
Volume 242, Issue -, Pages 131-141Publisher
ACADEMIC PRESS LTD- ELSEVIER SCIENCE LTD
DOI: 10.1016/j.jenvman.2019.03.112
Keywords
ASEAN; Economic growth; Pollution heavens hypothesis (PHH); Environmental kuznets curve (ECK); Emerging economies; Financial development; FDI; CO2 emission; FMOLS
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Funding
- University of Economics Ho Chi Minh City
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In the context of remarkable economic growth and financial development in the emerging economies of East Asia, this paper attempts to shed light on the ecological consequences (CO2 emission) of economic growth, foreign direct investment and financial development in the selected ASEAN-5 economies. Drawing on the data from 1982 to 2014, we employed a set of quantitative techniques for panel data analysis which entailed Dynamic Ordinary Least Squares (DOLS) and Fully Modified OLS (FMOLS) approaches. Our findings indicate that financial and economic development, as well as FDI, have a statistically significant long-run co-integrating relationship with environmental degradation (CO2 emissions) in the under analysis economies. It showed that in ASEAN-5 countries, economic growth, financial development and FDI leads to an increase in environmental degradation. The quadratic term for economic growth showed a negative impact on environmental degradation i.e. Environmental Kuznets Curve (EKC). Our key findings manifest and emphasise the importance of appropriate policies for more inclusive economic and financial development and sustainable foreign direct investment which does not impede on the environment.
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