ENVIRONMENTAL REGULATORY STRINGENCY, CORRUPTION, AND FDI: NEW EVIDENCE FROM A PANEL OF COUNTRIES

  • Sulhi Ridzuan UKM
  • Tamat Sarmidi UKM
  • Abu Hassan Shaari Mohd Nor UKM
Keywords: Keywords, FDI, pollution haven, corruption, developing countries, developed countries.

Abstract

Previous literatures on both studies of pollution haven and FDI-corruption nexus have produced inconclusive results. This study uses Generalized Method of Moments (GMM) to address potential endogeneity of independent variables and country-specific effects issues when assessing the relationship between foreign direct investment (FDI), stringency of environmental regulations and corruption. FDI inflows are found to be discouraged by stricter environmental regulations and high level of corruption will induce FDI. Surprisingly, we find new evidence that both effects are changed after each of them exceeds threshold levels. Countries have to pass the threshold levels in order to gain positive impact of both stricter regulations and low level of corruption.

Downloads

Download data is not yet available.

Author Biographies

Sulhi Ridzuan, UKM
School of Economics, Faculty of Economics and Management,Universiti Kebangsaan Malaysia
Tamat Sarmidi, UKM
School of Economics, Faculty of Economics and Management,Universiti Kebangsaan Malaysia
Abu Hassan Shaari Mohd Nor, UKM
School of Economics, Faculty of Economics and Management,Universiti Kebangsaan Malaysia
Published
24-08-2014
How to Cite
Ridzuan, S., Sarmidi, T., & Mohd Nor, A. H. S. (2014). ENVIRONMENTAL REGULATORY STRINGENCY, CORRUPTION, AND FDI: NEW EVIDENCE FROM A PANEL OF COUNTRIES. Journal of Techno Social, 6(2). Retrieved from https://publisher.uthm.edu.my/ojs/index.php/JTS/article/view/1114
Section
Articles