An analysis of the Pollution Haven Hypothesis in the context of Turkey: A nonlinear approach

Foreign direct investment (FDI) is an important driver of countries’ economic development. Factors such as looser environmental regulations may cause dirty FDI to flow mainly to developing countries. This is explained by the Pollution Haven Hypothesis. The paper aims to investigate whether the Pollu...

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Main Authors: Temurlenk M. Sinan, Lögün Anıl
Format: Article
Language:English
Published: Sciendo 2022-04-01
Series:Economics and Business Review
Subjects:
Online Access:https://doi.org/10.18559/ebr.2022.1.2
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author Temurlenk M. Sinan
Lögün Anıl
author_facet Temurlenk M. Sinan
Lögün Anıl
author_sort Temurlenk M. Sinan
collection DOAJ
description Foreign direct investment (FDI) is an important driver of countries’ economic development. Factors such as looser environmental regulations may cause dirty FDI to flow mainly to developing countries. This is explained by the Pollution Haven Hypothesis. The paper aims to investigate whether the Pollution Haven Hypothesis is valid in Turkey using the nonlinear autoregressive distributed lag (NARDL) approach for the period 1974–2017. The results show that FDI inflows and carbon emissions have asymmetric effects in both the short and long term for Turkey, supporting the Pollution Haven Hypothesis. Furthermore, there is a link between carbon emissions and trade openness, manufacturing and economic growth. Policymakers should develop the policies necessary to transfer clean technologies to Turkey by providing improvements and technical advances for a more efficient energy use.
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spelling doaj.art-562f3eaf81484a27b27f9c03520a515d2022-12-22T00:37:14ZengSciendoEconomics and Business Review2450-00972022-04-018152310.18559/ebr.2022.1.2An analysis of the Pollution Haven Hypothesis in the context of Turkey: A nonlinear approachTemurlenk M. Sinan0Lögün Anıl1Atatürk University, Faculty of Economics and Administrative Sciences, Department of Econometrics, 25240, Erzurum, TurkeyAtatürk University, Faculty of Economics and Administrative Sciences, Department of Econometrics, 25240, Erzurum, TurkeyForeign direct investment (FDI) is an important driver of countries’ economic development. Factors such as looser environmental regulations may cause dirty FDI to flow mainly to developing countries. This is explained by the Pollution Haven Hypothesis. The paper aims to investigate whether the Pollution Haven Hypothesis is valid in Turkey using the nonlinear autoregressive distributed lag (NARDL) approach for the period 1974–2017. The results show that FDI inflows and carbon emissions have asymmetric effects in both the short and long term for Turkey, supporting the Pollution Haven Hypothesis. Furthermore, there is a link between carbon emissions and trade openness, manufacturing and economic growth. Policymakers should develop the policies necessary to transfer clean technologies to Turkey by providing improvements and technical advances for a more efficient energy use.https://doi.org/10.18559/ebr.2022.1.2pollution haven hypothesisforeign direct investments (fdi)emissionsnonlinear autoregressive distributed lag modelturkeyc33e1q52
spellingShingle Temurlenk M. Sinan
Lögün Anıl
An analysis of the Pollution Haven Hypothesis in the context of Turkey: A nonlinear approach
Economics and Business Review
pollution haven hypothesis
foreign direct investments (fdi)
emissions
nonlinear autoregressive distributed lag model
turkey
c33
e1
q52
title An analysis of the Pollution Haven Hypothesis in the context of Turkey: A nonlinear approach
title_full An analysis of the Pollution Haven Hypothesis in the context of Turkey: A nonlinear approach
title_fullStr An analysis of the Pollution Haven Hypothesis in the context of Turkey: A nonlinear approach
title_full_unstemmed An analysis of the Pollution Haven Hypothesis in the context of Turkey: A nonlinear approach
title_short An analysis of the Pollution Haven Hypothesis in the context of Turkey: A nonlinear approach
title_sort analysis of the pollution haven hypothesis in the context of turkey a nonlinear approach
topic pollution haven hypothesis
foreign direct investments (fdi)
emissions
nonlinear autoregressive distributed lag model
turkey
c33
e1
q52
url https://doi.org/10.18559/ebr.2022.1.2
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