Abstract
From the micro level, this paper thoroughly investigates the influence of environmental regulations (ERS) on the inflow of foreign direct investment (FDI) in China. Firstly, the entropy method was adopted to comprehensively measure the ERS intensities of 283 Chinese cities at prefecture level and above in 2003-2016. Then, the Cournot model was utilized to analyze how ERS affects FDI. After that, fixed-effects model was employed to empirically examine the impacts of ERS intensities in eastern, central, and western regions on FDI inflow. The results show that: The regression results on nationwide, central, and western samples indicate that the influence of ERS variable was significantly negative. This means ERS is indeed an important consideration of foreign investors in location selection. Besides, stricter ERS hinders the inflow of FDI, which agrees with the pollution haven hypothesis. On eastern samples, stricter ERS promotes FDI inflow, that is, the situation in eastern region meets Porter hypothesis. Finally, several suggestions were presented for policymakers based on the empirical results.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callMore From: International Journal of Sustainable Development and Planning
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
