Pollution Haven Research Articles

The impact of the digital economy on inter-city carbon transfer in China using the life cycle assessment model

The haven paradise hypothesis has been widely supported in the international carbon transfer, but there is still a lack of inter-city evidence. The emergence of the digital economy in recent years has introduced unprecedented opportunities and challenges for carbon emissions reduction and carbon transfer. As the world’s largest carbon emitter and a major player in the digital economy, exploring whether the pollution haven hypothesis exists among cities in China and how the digital economy affects inter-city carbon transfer is crucial for countries to optimize their domestic carbon reduction structures. To this end, this paper employs the 2012 and 2015 Chinese Urban Household Survey data alongside input-output tables based on the life cycle assessment method to quantify the inter-city carbon transfer. In addition, the impact and mechanisms of the digital economy on inter-city carbon transfer are explored using the two-way fixed effects model. The results show that 54% of Chinese cities’ carbon emissions come from outside, with third-tier cities bearing high carbon transfer pressures, indicating the presence of the pollution haven hypothesis. The digital economy exacerbates inter-city carbon transfer by promoting market integration and facilitating industrial transfer, and it mainly promotes the transfer of high-intensity carbon emissions to third-tier cities. Considering carbon emission reduction targets, mandatory environmental regulations have strengthened the effect of the digital economy on carbon transfer. Therefore, the Chinese government needs to properly address carbon transfer by improving the collaborative carbon reduction system, enhancing carbon emission reduction efficiency, and accelerating the equitable progress of the digital economy.

Tourism and the Mediterranean Experience Amidst Environmental Issues: Fresh Insights from Panel Analysis

According to the United Nations World Tourism Organization (UNWTO), tourism is critical to a country's economic development. It acts as a catalyst for direct and indirect job creation, economic growth, and the attraction of foreign direct investment (FDI). To this end, the present study looks into the relationship between economic growth (GDP), domestic credit (DC), tourism (TR), FDI, and CO2 emissions for selected Mediterranean countries. This study employs panel corrected standard errors (PCSE) and dynamic ordinary least squares (DOLS) approaches to assure the trustworthiness of the findings. The empirical information gathered supports the idea that tourism adds to pollution in the analyzed blocs. Furthermore, the data supports the pollution haven hypothesis concept by demonstrating that an increase in FDI harms the environment. The study's findings advocate for precautionary actions to alleviate the detrimental effects of tourism-related pollution. Ecotourism policies that support sustainable behaviors must be developed and implemented. Countries can establish a balance between economic growth and environmental protection by implementing such policies. Governments, policymakers, and stakeholders must work together to create effective frameworks and policies that promote responsible tourism. This research fills a knowledge vacuum by shedding light on the specific dynamics of Mediterranean tourism businesses. Economic growth, domestic credit, tourism, FDI, and CO2 emissions are all linked, according to empirical research. The findings highlight the importance of establishing ecotourism legislation and constructing sustainable infrastructure to reduce tourism's negative environmental impacts. Countries may safeguard the long-term viability of their tourism businesses by finding a balance between economic growth and environmental protection.

How asymmetric is the response of CO2 emissions to economic restructuring in China? Evidence from NARDL approach

China has experienced a remarkable economic progression since the implementation of its reform and opening-up policy. Yet, it is crucial to confront the challenge of achieving sustainable and high-quality economic growth while concurrently enhancing environmental quality. This study adopts the nonlinear autoregressive distributed lag (NARDL) approach to explore how economic structure adjustments impacted China's carbon dioxide (CO2) emissions from 1980 to 2020. The empirical results reveal some asymmetries in the influence of agricultural progression, industrial development, and foreign direct investment (FDI) on CO2 emissions in short and long-term contexts. Specifically, in the long run, a 10% positive change in agricultural development increases CO2 emissions by 1.55%, nearly double the mitigation effect of a negative change (0.78%); a 10% positive (negative) change in industrialization is associated with a 0.6% decrease (0.23% increase) in CO2 emissions; a 10% positive change in FDI results in a 2.30% increase in CO2 emissions, supporting the "Pollution Haven" hypothesis, while a 10% negative change contributes to a 4.51% increase. In the short run, a 10% negative change in agricultural and industrial sectors increases CO2 emissions by 0.27% and 0.21%, respectively, while a 10% negative change in FDI leads to a 2.0% increase in CO2 emissions. Additionally, short-term positive changes in agricultural and industrial sectors and positive shocks in FDI exert negligible influence on CO2 emissions. These findings highlight the necessity of economic structure transformation and refinement of current environmental policies.

Pollution Haven Hypothesis and the Bilateral Trade Between India and China

The pollution haven hypothesis is studied from a bilateral trade perspective in this study, taking the reference of two Asian giants, namely, India and China. For this purpose, trade in pollution-intensive industries is analysed using data collected from the United Nations Comtrade dataset based on Standard Industrial Trade Classification codes for 1992–2019. The analysis helps us argue that between the two, China's demand is more pollution-intensive and India is the major supplier of pollution-intensive products. From an environmental perspective, this implies that China seems to be gaining from trade, and India is becoming a pollution haven in its trade with China.

Is FDI inflow bad for environmental sustainability?

AbstractIn the last few years, discussions and debates around environmental sustainability have become a key goal of the global agenda. This is because the latest studies and our direct experiences of the consequences of environmental degradation and climate change are showing that economic models need some urgent changes. The goal of this paper was to investigate the effects of foreign direct investment (FDI) flow on environmental sustainability globally. The balanced panel data of 100 countries from 2000 to 2020 were used for empirical analysis to understand the relationship between FDI inflow and environmental performance index (EPI) for countries with different income levels. The estimation is made using the two-step system GMM model as it gives more robust and efficient results in this study. The results of the dynamic panel model do not support the pollution haven hypothesis, i.e., FDI inflow was not found to have any statistically significant effect on EPI. The findings of the paper suggest that to improve environmental quality globally, it is important for governments to invest more in renewable energy projects as clean energy consumption can be one of the most efficient solutions for reducing the impact of climate change. Moreover, countries need to reduce the unemployment rate as it significantly improves the environmental quality according to our estimation results.

The dynamic relationship between resources, finances, and sustainable development: An in-depth analysis

The expansion of the economy and the use of natural resources have been identified as the main causes of environmental degradation. As a result, there is a need for sustainable and environmentally-friendly growth. However, the concept of "pollution havens" is becoming increasingly relevant, with businesses relocating to developing countries in search of more lax environmental regulations. This could lead to higher-than-desirable rates of pollution and environmental damage. To address this issue, this study assesses the role of natural resources (NTR), Foreign Direct Investment (FDI), Financial Development (FDT), and Green Finance (GFN) using QARDL analysis. The study found that NTR, FDI, and FDT increased CO2 emissions, while GFN reduced them in the short and long run. The findings provide valuable insights for policymakers, who can use the information to develop policies that promote economic growth while reducing environmental pollution. Additionally, the study highlights the need to prevent businesses from exploiting lax environmental regulations in developing countries. Overall, the findings of this study underscore the importance of balancing economic development and environmental sustainability and call for the prioritization of green initiatives in policy development.

Attaining environmental sustainability amidst the interacting forces of natural resource rent and foreign direct investment: Is Norway any different?

AbstractThis is a study of Norway's sustainable environment development amidst the interactions of natural resources, external investment (FDI) and economic development. Much has been done with respect to the study of Norway's economic performance in relation to the link between the natural resources and FDI with little emphasis on the environmental performance of the resource‐based economy. Also, Norway is classified as among the top countries in Europe with a greater percentage of adopting renewable energy, and no study has done a critical review of the impact of natural resources and FDI which are part of drivers of carbon emission that can counter the positive impact of renewable energy towards the Norway's sustainable environment. On this basis, this study adopts a time series data of Norway, 1970 to 2018 to study its environmental performance. Approaches such as structural break analysis, Autoregressive Distributed Lag (ARDL)‐bound testing and Granger causality estimations are utilised in this study for in‐depth analysis of the subject. Findings from ARDL confirmed a positive association between fuels and carbon emission, other indicators (economic growth and natural resources) are improving the quality of the country's environment. FDI even though shows positive sign remains insignificant in impacting the environmental performance in the short run reverted to a significant negative relationship with carbon emissions. This confirms the pollution halo hypothesis and rejects the pollution haven hypothesis (PHH) for Norway, and this trend can be sustained with the constant implementation of environmental rules in the country. Granger test confirms, a one‐way transition from fossil fuels to carbon emission, from carbon emission to growth, and from economic growth to fossil fuels. Also, a two‐way transmission is found between fossil fuels and FDI. These findings from Granger causality are consistent with the findings from ARDL, hence, two ways interactions between FDI and fossil fuel energy source consumption from Granger causality and the two variables (fossil fuels and FDI) are seen impacting on Norway's environmental performance. Findings from the estimates suggest that natural resources and FDI are mitigating pollution, hence, Norway's policy is expected to be resources and FDI driven in sustainable environment development.

Pollution haven or pollution halo? The role of global value chains in Belt and Road economies

Abstract“Global value chains” (GVCs) participation brings countless economic and environmental benefits to “Belt and Road Initiative” (BRI) economies. As the nations associated with BRI are crucial members of GVCs, analyzing the influence of GVCs on environmental quality in BRI economies is of great significance. By joining regression models with “multi‐region input–output” analyses, current study inspects the influence of GVCs on environmental quality in 82 BRI economies from 2002 to 2018. This study considered different GVCs participation modes and national heterogeneity to check “pollution haven hypothesis and pollution halo hypothesis” theories. The GVC position worsened environmental quality in the full BRI panel and validated the pollution haven hypothesis theory. Forward and backward participation improves environmental quality and confirms the pollution halo hypothesis. Moreover, income‐specific outcomes showed divergent patterns related to GVCs and environmental quality. GVCs' position of GVCs promotes the environmental quality of developed and emerging countries and exacerbates that of developing and underdeveloped economies. Moreover, the links of forward and backward participation with environmental quality showed mixed results for the pollution haven and halo theories in all subpanels. The results propose that the BRI should focus on upgrading GVCs and adopting region‐specific green policies to ensure a sustainable environment.

Corporate sustainability and financial performance: A hybrid literature review

AbstractThe discussion of “whether it pays to be green” is ongoing. This review does not intend to solve the debate, rather it soothes it by contributing to the concept of “when it pays to be green.” By focusing on the shortcomings of existing literature reviews on the topic of corporate sustainability and financial performance (CSFP) in this hybrid review, issues were identified that had been overlooked earlier. In general, CSFP holds a positive relationship but in a time lag. Nonconclusive results about the relationship within CSFP are due to self‐selection bias, endogeneity issues, and the use of multiple datasets and industry categories. Surprisingly, we also discovered that the impact of sustainability on financial performance is elusive in capitalist countries considered to be economically rational. Institutional and legitimacy requirements are a good starting point for shaping corporate behaviors in the short term; however, they might not be equally appropriate in the long term in cases when corporations shift operations to pollution havens. A multifaceted, synergistic interaction between governmental institutions, corporations, and other stakeholders is required—without imposing authority—to ensure durable sustainable development.

Türkiye’nin Enerji ve Atık Sektörü İçin Kirlilik Cenneti Hipotezinin Sektörel Geçerliğinin Test Edilmesi

The increase in environmental standards in developed countries and the efforts of developing countries to attract foreign direct investments (FDI) offer both a theoretical and an empirical research area. In practice, this situation, which can be seen as a shift of investments to countries with looser policies in order to avoid the costs of environmental regulations, is called the pollution haven hypothesis (PHH). In this study, the existence of the mentioned hypothesis for Türkiye's waste and energy sector is investigated. In order to test the hypothesis, linear time series analysis methods are used in the study. When the findings are examined, it is observed that the hypothesis is valid in both sectors.

Carbon emission reduction effect of renewable energy technology innovation: a nonlinear investigation from China's city level.

There has always been controversy over how renewable energy technologies can play a role in reducing carbon emissions. Based on the energy patent data and the economic data of 244 prefecture-level cities from 2007 to 2017 in China, we explore the carbon reduction effect of renewable energy technology and its mechanism from the perspective of energy production, conservation, and management. The two-way fixed effect, instrumental variable, spatial Durbin, and mediation effect models are employed to explore empirical results. We found that (1) the impact of renewable energy technologies on carbon emissions is nonlinear, with an inverted U shape. However, this inverted U-shaped relationship only exists locally in cities and there are uncertainties in adjacent cities, which indicates that cross-regional cooperation in renewable energy technology needs to be improved. (2) The mechanism analysis shows that industrial agglomeration and energy consumption scale are the channels that renewable energy technologies affect carbon emissions. Thus, the implicit carbon emissions generated by industrial agglomeration and the failure to green upgrade energy consumption are the main reasons for the inverted U-shaped relationship. (3) The carbon reduction effect of renewable energy technologies of conservation type takes effect first, and renewable energy technologies of production type do not reduce carbon emissions in non-eastern cities, which means that non-eastern cities are likely to become pollution havens. This study provides evidence for renewable energy technologies to achieve efficient carbon emission reduction and cross-regional technical cooperation.

Spatial correlation and coupling between industrial enterprise agglomeration and water pollutant discharge

Industrial wastewater discharge has become the main cause of water pollution in China. However, the spatial interaction mechanism between industrial structure and water pollution is still unclear. Accordingly, we evaluated and analyzed spatiotemporal changes of the agglomeration pattern of pollution-intensive industrial enterprises and the evolution of the water environmental pollution pattern, as well as the correlation between them. The study results show that the polluting industrial enterprises were located mainly along the Yangtze River and Taihu Lake Basin in southern Jiangsu in 2013 and 2018. However, we observed a spatial trend of pollution transfer to northern Jiangsu. The industrial water pollution discharge presents the distribution pattern of facing rivers, seas, lakes and cities. Papermaking and paper products industry are the leading factors of COD and NH3–N pollution, with explanatory power of 0.3666 and 0.6201 respectively. The spatial positive coupling effect between the concentration degree of polluting enterprises and the intensity of water environment pollution discharge is 94.95% of the region. The spatial agglomeration of polluting industrial enterprises is an important cause of water environment pollution. They promote and couple each other, proving the existence of “Pollution haven” and “Porter hypothesis".

The effects of different forms of FDI on the carbon emissions of multinational enterprises: A complex network approach

The carbon emissions of multinational enterprises (MNEs) through FDI are causing a shift in the emissions burden and threatening mitigation targets. The purpose of this paper is to investigate the effects of the FDI stock, greenfield FDI, and M&As on carbon emissions of MNEs from 2005 to 2016 via quadratic assignment procedure (QAP) network analysis. Through QAP network analysis, we study the FDI-carbon emissions linkage considering the interactions among agents. The results show that the “high-income region to low-income region” mode is gradually becoming the driving force in the global carbon flow, producing lots of carbon emissions with a lower investment. The investments in this mode are dirtier. Second, financial institutions have become the key emitters of global carbon emissions through FDI. This investment model makes global carbon transfer indirect and concealed. Third, the significance of the impacts of the three forms of FDI on the carbon emissions of MNEs is positive, which confirms the pollution haven effect. The greatest contributor is the FDI stock, which comes from historical investments in high-income regions. Greenfield FDI is more influential than M&As in both high- and low-income regions. This paper is a valuable reference for understanding the environmental effects of FDI.

Environmental regulations, green development of agriculture, and residents' health-empirical analysis of Yangtze River Economic Belt in China.

Environmental pollution and food safety have become key public health issues to be addressed in China. Since they are closely related to the green development of agriculture, it is of great practical significance to elucidate the intrinsic relationships between green development of agriculture, environmental regulation and residents' health. Based on the panel data of the Yangtze River Economic Belt from 2011 to 2020, this study investigates the impacts of environmental regulation and green development of agriculture on residents' health and the influencing mechanism by applying fixed effects method, mediating effectsmethod and the spatial Dubin method. Results show that the use of chemical fertilizers, pesticides and agricultural films is harmful to residents' health; environmental regulation has a negative correlation with the green development of agriculture and affect residents' health through mediating effects; the green development of agriculture has negative spillover effects on residents' health, indicating that purchasing finished products instead of producing locally reduces the input of production factors such as chemical fertilizers and pesticides and transfers health risks associated with agricultural production activities to neighboring areas. Intensifying command-and-control environmental regulation will induce the expansion of hidden economic activities and harm local residents' health, while intensifying market-incentive environmental regulation will lead to the 'Pollution Haven' phenomenon because of the 'race to the bottom', in government and is harmful to the health of residents in neighboring areas. Therefore, it is necessary to formulate reasonable and feasible policies and strengthen the control and prevention of agricultural pollution to enhance green development of agriculture and improve residents' health.

How do intellectual property demonstration cities contribute to low-carbon development? Evidence from China.

An intellectual property demonstration city (IPDC) not only promotes innovation, but also brings many unexpected gains, the most prominent of which is carbon reduction. Unfortunately, few scholars have included IPDC and carbon emissions in a unified research framework, ignoring the role of intellectual property protection in environmental governance. Therefore, this paper investigates the impact of IPDC on carbon emissions through a multi-period difference-in-difference (DID) model, a spatial DID model, and a mediating effect model with IPDC policy as a quasi-natural experiment. The research results are as follows: (1) IPDC policy has a significant inhibitory effect on carbon emissions. Compared to non-pilot cities, IPDC policy can reduce carbon emissions by about 20.6%. (2) There are temporal and regional heterogeneity of the IPDC policy on carbon emissions. More specifically, the carbon reduction effect of IPDC is more effective in large cities and cities with richer human capital, stricter environmental regulation, and higher financial development. Meanwhile, the policy effects in 2012 and 2015 are larger than those in 2018, while the policy effects in 2014, 2016, and 2019 are not significant. (3) IPDC policy reduces carbon emissions mainly by stimulating innovation and green innovation, and promoting R&D element agglomeration. (4) IPDC policy has obvious spatial spillover effects and leads to the surrounding cities becoming pollution havens. The above conclusions have implications for designing a better urbanization model to promote innovative development and reduce carbon emissions.

Is there a pollution haven in European Union global value chain participation?

This paper aims to test the pollution haven hypothesis within the European Union (EU), especially among newcomer countries, through the participation in global value chains (GVCs). The study used a combination of multiregional input–output method and multilevel mixed econometric analysis to investigate the relationship between global value chain trade flows, foreign direct investment flows, energy consumption, and carbon emissions across countries, sectors, and time. The study tested both the “pollution haven” and “pollution halo” hypotheses and found a non-linear relationship between foreign capital flows and carbon emissions, which became less relevant after the economic integration process. The results suggest the existence of a pollution haven in Europe. Although Eastern economies still exhibit problematic issues in relation to pollution control, they have made significant progress in reducing their emissions intensity. The conclusions include some policy recommendations based on the main findings of the research.

Does Clean Energy Reduce Environmental Pollution under the Environmental Kuznets Curve Hypothesis in Sri Lanka?

This study explores the nexus among clean energy, economic growth, urbanization, trade openness, and carbon dioxide (CO2) emissions nexus in an emerging economy, Sri Lanka. An autoregressive distributed lag (ARDL) econometric technique and different diagnostic tests are used to investigate the linkages. The pairwise Graner causality approach is applied to investigate the causality direction. The estimated results have confirmed that clean energy and urbanization reduce carbon emissions, whereas trade openness induces carbon emissions in the long run in Sri Lanka. The findings revealed the non-existence of the environmental Kuznets curve (EKC) hypothesis in Sri Lanka. In contrast, the pollution haven hypothesis (PHH) exists between trade openness and carbon dioxide emissions in Sri Lanka. Regarding causal relationships, there is bi-directional causality between clean energy and urbanization. This study reports a unidirectional causality from clean energy to CO2 emissions, economic development to carbon emissions, urbanization and trade and CO2 emissions to urbanization and trade. Based on the above findings, this study recommends some policy recommendations.

The Effect of FDI on Environmental Degradation in Romania: Testing the Pollution Haven Hypothesis

The study examines the relationship between CO2 emissions, trade openness, GDP growth and foreign direct investment (FDI) in Romania. The research aims to provide empirical evidence for either the pollution haven hypothesis (PHH) or the pollution halo effect (PHE). The pollution haven hypothesis suggests that countries with weaker environmental regulations and lower environmental quality are more attractive to FDI, while the pollution halo effect posits that countries with high levels of environmental protection and quality can generate positive spillover effects for FDI. The findings suggest a significant relationship between CO2 emissions, GDP growth and FDI inflows, with GDP growth having a greater effect on FDI than CO2 emissions. GDP growth has a causal effect on CO2 emissions, while CO2 emissions have a causal effect on FDI. These findings have important policy implications, as they highlight the interplay between economic growth, environmental degradation, and foreign investment. Policies aimed at reducing emissions must be comprehensive and coordinated in order to achieve significant emissions reductions and strike a balance between economic growth and environmental protection.

Impact of Population, Trade Openness, and Foreign Investment on India’s Environment: An Empirical Evaluation of a STIRPAT Model

India is excelling in almost all parameters of economic development. However, India is experiencing economic development with a pinch of salt; massive climate and environmental changes are seen. As per Global Climate Risk Index 2021, India was ranked as the 7th worst climate hit country in the world. The present study is an attempt to empirically evaluate the impact of India’s economic growth, population, foreign investment, and trade openness on carbon emissions. The study adopts the STochastic Impacts by Regression on Population, Affluence and Technology (STIRPAT) framework augmented with the Environment Kuznet’s Curve (EKC) model with a time series data over the period 1971–2020. Results for unit root testing indicated the presence of mix stationarity for the variables, therefore, the autoregressive distributed lag approach was apt for capturing the long- and short-run dynamics. The results validated EKC for affluence and population. The outcome for FDI inflows and trade openness suggested the presence of pollution haven hypothesis for India. Policy initiatives toward green and sustainable production processes are suggested.

Analyzing the Impact of Geopolitical Risk, and Renewable Energy Towards Sustainable Development in China

Geopolitical relationship among the economies plays a crucial role in the environmental sustainability. In lieu our research reveals that whether geopolitical risk asymmetrically affects the reduction of carbon emission? To investigate this issue, we scrutinize the impact of geopolitical risk using annual data spanning 1990-2018 for China. Furthermore, our study employs nonlinear and liner autoregressive distributed lag simulations at the same time to argue the impact of geopolitical risk on environmental sustainability. Our empirical outcomes evidenced the asymmetric effect of geopolitical risk on the environment by indicating a positive association among geopolitical risk and environmental sustainability. Moreover, increasing foreign direct investment upsurges CO2 emanation which proves the pollution haven proposition. The results expressed a significant positive link of energy ingesting and GDP influence on CO2 emanation while renewable energy consumption reduces CO2 emission. Therefore, utmost attention must be taken to balance the environment and geopolitical risk. It is necessary to take initiatives to reforms policies that protect the environment without affecting geopolitical risk. Additionally, government officials and policymakers should articulate strategies to encourage renewable energy consumption as the energy combination outpouring to enrich the excellence of the environment. The findings also advocate that policymakers to welcome the environment-friendly foreign direct investment as it is the perpetrator to upsurge environmental degradation in China.