Emission reduction and foreign direct investment nexus in China

Yuan Xu, Yanrui Wu, Yongli Shi

Research output: Contribution to journalArticlepeer-review

13 Citations (Scopus)

Abstract

This paper employs a difference-in-difference-in-difference approach to examine the emission reduction and foreign direct investment nexus in China. It combines a firm-level dataset with emission reduction target statistics at city-level. The findings indicate that stringent environmental regulation is associated with the fall of the output of foreign firms in general and the shrinking of pollution-intensive industries in cities with heavy emission reduction pressure in particular. It is also shown that the location choice of foreign investment changes as emission reduction targets at city-level vary. Finally it is found that environmental regulation helps improve the structure of foreign direct investment and hence contributes to industrial upgrading in the economy.

Original languageEnglish
Article number101305
JournalJournal of Asian Economics
Volume74
DOIs
Publication statusPublished - Jun 2021

Fingerprint

Dive into the research topics of 'Emission reduction and foreign direct investment nexus in China'. Together they form a unique fingerprint.

Cite this