Abstract
In this modern era, the global warming issue has been on the front burner of almost all countries including Malaysia. This study utilizing time series data spanning from 1970 to 2018. To this end, a linear and nonlinear autoregressive distributed lag model was conducted to reveal the foreign direct investment-growth-environment nexus. The conclusion validates the existence of the pollution haven hypothesis in Malaysia. Specifically, the empirical results of the linear autoregressive distributed lag model indicate that foreign direct investment and real gross domestic product have a significant positive impact on CO2 emission while carbon damage cost and the interaction term of foreign direct investment and carbon damage cost have a negative impact in the long run and short run. To find the asymmetric behavior of the foreign direct investment our study employed a nonlinear autoregressive distributed lag model. The findings confirmed the asymmetry association of foreign direct investment with CO2 emission. Interestingly, our results of the interaction term in both models are significant with a negative sign that shows the mediating effect of carbon damage cost that converts the positive effect of foreign direct investment on CO2 emission to negative. Thus, it is vital to reinforce the use of significant regulation as the Malaysian economy opens up to attract more foreign direct investment.
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The authors acknowledge the Editor of Environmental Science and Pollution Research, the whole research team, our family, and research fellows.
Author position
1. Dr. Muhammad Faheem: Assistant Professor, School of Economics, Bahauddin Zakariya University, Multan, Pakistan
2. Mr. Sadam Hussain: PhD Scholar, Center for Industrial and Business Organization, Dongbei University of Finance and Economics, China
3. Mr. Arsalan Tanveer: PhD Scholar School of Economics and Management, Nanjing University of Science and Technology, People’s Republic of China. 210094
4. Dr. Noreen Safdar: Assistant Professor, The Women University Multan Pakistan.
5. Mr. Muhammad Arshad Anwer: M. Phil Scholar National University of Modern Languages, Multan, Pakistan.
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1. Dr. Muhammad Faheem: Complete writing of the paper with the conceptualization of framework
2. Mr. Sadam Hussain: Exhibited support in mathematical equations and proofreading
3. Mr. Arsalan Tanveer: Performed references verification and software support
4. Dr. Noreen Safdar: Worked on the references verification, proofreading, and grammatical corrections
5. Mr. Muhammad Arshad Anwer: Designed paper formats including tables and figures adjustments with econometric technique validation
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Faheem, M., Hussain, ., ArsalanTanveer et al. Does foreign direct investment asymmetrically affect the mitigation of environmental degradation in Malaysia?. Environ Sci Pollut Res 29, 7393–7405 (2022). https://doi.org/10.1007/s11356-021-16231-0
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DOI: https://doi.org/10.1007/s11356-021-16231-0