The Research On The Dynamic Effect Of Foreign Direct Investment On Carbon Dioxide Emissions

With the rapid flow of international capital in the world, the foreign directinvestment flows into our country in an increasing rate and it makes the strength ofeconomy in our country stronger. However, the foreign direct investment also to someextent brings some environmental problems on carbon dioxide emissions in a certaindegree. Relevant data show that China is the country which has the most carbondioxide emissions in the world. Therefore in order to meet the urgent needs, thetheory and empirical analysis of this problem is a task which brooks no delay.The theory which is the effect of foreign direct investment on carbon dioxideemissions is divided into two conduction mechanism of positive and negative effect.The conduction mechanism of the positive effect of foreign direct investment oncarbon dioxide emissions is following: with the increasing amount of foreign directinvestment, the change of the mode of foreign direct investment, the change of thenational income, clean technology diffusion and the adjustment of trade structure willeffectively promote the formation of low carbon environment. The conductionmechanism of the negative effect of foreign direct investment on carbon dioxideemissions is following: with the increasing amount of foreign direct investment, thechanges of production scale, regional structure distribution as well as thecontroversial technology diffusion will lead to the deterioration of low carbonenvironment.This paper analyses the effect of foreign direct investment on carbon dioxideemissions using the dynamic panel data which is from2000to2010in30provinces ofChina and two-step system method. Empirical analysis includes the national model,the regional and the trade model. Through a series of empirical analysis theconclusions are as follows: to the hole country, effect of foreign direct investment oncarbon dioxide emissions is positive; regional differences of carbon emissions inChina are very evident, and the eastern region is dynamic maximum and the central isdynamic minimum; to the trade model, in the manufacturing industry effect of foreigndirect investment on carbon dioxide emissions is negative. But in electronicinformation and construction industry effect of foreign direct investment on carbondioxide emissions is positive. Empirical analysis is combined with the theoreticalanalysis, and the industry influence mechanism is further elaborated. According to the above analysis, finally put forward the following policysuggestions: firstly, improve the industrial structure of foreign direct investment;secondly, strengthen the low carbon environmental protection policies andinstitutional orientation; thirdly, perfect and improve the low carbon environmentalprotection laws and regulations; finally, encourage domestic enterprises to learnforeign clean technology.