Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL
Domestic capital adequacy and sustainable economic growth are heavily reliant on technological advancement, managerial know-how, and money supply in the economy. In this context, FDI has emerged and is placed at an apex position due to its unprecedented impact on achieving sustainability across the...
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| Format: | Article |
| Language: | English |
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Frontiers Media S.A.
2022-12-01
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| Series: | Frontiers in Environmental Science |
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| Online Access: | https://www.frontiersin.org/articles/10.3389/fenvs.2022.936216/full |
| _version_ | 1828032212971290624 |
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| author | Long JinRu Md. Qamruzzaman Wu Hangyu Rajnish Kler |
| author_facet | Long JinRu Md. Qamruzzaman Wu Hangyu Rajnish Kler |
| author_sort | Long JinRu |
| collection | DOAJ |
| description | Domestic capital adequacy and sustainable economic growth are heavily reliant on technological advancement, managerial know-how, and money supply in the economy. In this context, FDI has emerged and is placed at an apex position due to its unprecedented impact on achieving sustainability across the world. The motivation of this study is to scale the effects of good governance, financial inclusion, and environmental quality on inflows of FDI in BRI nations for the period from 1990 to 2020. Several panel econometrical tools have been applied, for example, CDS, CADF, CIPS, CS-ARDL, and NARDL, to investigate the association and explanatory variables elasticity on inflows of FDI in BRI nations. CDS results revealed that research units share common dynamism and second-generation panel unit root test-documented variables are stationary after the first difference. The results of the panel co-integration with an error-correction term confirmed the empirical equation’s long-run association. According to the CS-ARDL assessment, positive and statistically significant impacts have been documented, from financial inclusion, good governance, and environmental quality to FDI inflows. Study findings suggest that governmental effectiveness, easy access to financial services and benefits, and a less-regulated environmental concern economy motivate capital transfer decisions. The asymmetric assessment documented a long-run asymmetric association between FI, GG, EQ, and FDI. Referring to asymmetric shock elasticity, the study disclosed a positive and statistically significant relation to FDI inflows, especially in the long run. The directional causality test documented bidirectional causality running between FI, EQ, GG, and FDI [FI←→FDI; GG←→FDI; and EQ←→FDI] in the short-run. |
| first_indexed | 2024-04-10T15:02:18Z |
| format | Article |
| id | doaj.art-b1dc04a7741041e883729d79e6a79914 |
| institution | Directory Open Access Journal |
| issn | 2296-665X |
| language | English |
| last_indexed | 2024-04-10T15:02:18Z |
| publishDate | 2022-12-01 |
| publisher | Frontiers Media S.A. |
| record_format | Article |
| series | Frontiers in Environmental Science |
| spelling | doaj.art-b1dc04a7741041e883729d79e6a799142023-02-15T11:03:31ZengFrontiers Media S.A.Frontiers in Environmental Science2296-665X2022-12-011010.3389/fenvs.2022.936216936216Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDLLong JinRu0Md. Qamruzzaman1Wu Hangyu2Rajnish Kler3City College, KunMing University of Science and Technology, KunMing, ChinaSchool of Business and Economics, United International University, Dhaka, BangladeshBusiness School Beijing International Studies University, Beijing, ChinaDepartment of Commerce Motilal Nehru College (E), University of Delhi, New Delhi, IndiaDomestic capital adequacy and sustainable economic growth are heavily reliant on technological advancement, managerial know-how, and money supply in the economy. In this context, FDI has emerged and is placed at an apex position due to its unprecedented impact on achieving sustainability across the world. The motivation of this study is to scale the effects of good governance, financial inclusion, and environmental quality on inflows of FDI in BRI nations for the period from 1990 to 2020. Several panel econometrical tools have been applied, for example, CDS, CADF, CIPS, CS-ARDL, and NARDL, to investigate the association and explanatory variables elasticity on inflows of FDI in BRI nations. CDS results revealed that research units share common dynamism and second-generation panel unit root test-documented variables are stationary after the first difference. The results of the panel co-integration with an error-correction term confirmed the empirical equation’s long-run association. According to the CS-ARDL assessment, positive and statistically significant impacts have been documented, from financial inclusion, good governance, and environmental quality to FDI inflows. Study findings suggest that governmental effectiveness, easy access to financial services and benefits, and a less-regulated environmental concern economy motivate capital transfer decisions. The asymmetric assessment documented a long-run asymmetric association between FI, GG, EQ, and FDI. Referring to asymmetric shock elasticity, the study disclosed a positive and statistically significant relation to FDI inflows, especially in the long run. The directional causality test documented bidirectional causality running between FI, EQ, GG, and FDI [FI←→FDI; GG←→FDI; and EQ←→FDI] in the short-run.https://www.frontiersin.org/articles/10.3389/fenvs.2022.936216/fullfinancial inclusionenvironmental qualitygood governanceFDINARDLCS-ARDL |
| spellingShingle | Long JinRu Md. Qamruzzaman Wu Hangyu Rajnish Kler Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL Frontiers in Environmental Science financial inclusion environmental quality good governance FDI NARDL CS-ARDL |
| title | Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL |
| title_full | Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL |
| title_fullStr | Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL |
| title_full_unstemmed | Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL |
| title_short | Do environmental quality, financial inclusion, and good governance ensure the FDI sustainably in Belt and Road countries? Evidence from an application of CS-ARDL and NARDL |
| title_sort | do environmental quality financial inclusion and good governance ensure the fdi sustainably in belt and road countries evidence from an application of cs ardl and nardl |
| topic | financial inclusion environmental quality good governance FDI NARDL CS-ARDL |
| url | https://www.frontiersin.org/articles/10.3389/fenvs.2022.936216/full |
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