Volume 4, Issue 1, June (2017)

  Foreign Direct Investment and Environmental Pollution: New Evidence from China  
  Meng Yan[1]

Zhen An[2]

Doi: 10.5455/ELet.2017.4.1.1


This paper investigates the relationship between FDI and environmental pollution based on 30 provincial capital cities data from China and exploits the possible mechanisms that cause specific pattern between FDI and environmental pollution. According to panel data model with and without technological progress, the relationship between FDI and sulfur dioxide exhibits inverted U-shaped pattern, yet there is no certain pattern between FDI and PM10 under two circumstances, in the meanwhile, the quadratic relationship between FDI and nitrogen dioxide disappears once incorporating technological progress. This paper further estimates such relationship by utilizing panel threshold model and concludes the impact of FDI on the emission of PM10 exhibits N-shaped pattern rather than usual U-shaped pattern, the relationship between FDI and sulfur dioxide may exist inverted V or U-shaped pattern and there is no any specific relationship between FDI and nitrogen dioxide. Theoretically, production scale effect, technique effect and regulation effect brought by FDI jointly determine the impact of FDI on environmental pollution and latter two effects will relieve the environmental deterioration in the long run.


Keywords: Economic Growth; FDI; Environmental pollution; Panel Threshold Model.
JEL Codes: Q56; F21; C23.

[1] (Corresponding Author) Department of Economics, University of New Hampshire,10 Garrison Avenue, Durham, NH, USA, 03820, e-mail: my1019@wildcats.unh.edu.

[2] School of Business, University of Connecticut, 1 University Plaza, Stamford, CT, USA, 06901, e-mail: zhenan548@gmail.com



The Fiscal Impacts of Privatization Reforms in Pakistan:

A Dynamic Analysis



Abdul Aleem Qureshi [1]

Syed Faizan Iftikhar

Mohsin Hasnain Ahmed

Doi : 10.5455/ELet.2017.4.1.2






There are various reasons of privatization attraction for the regime of the developing nations. These revenues from the sale of state owned enterprises can demonstrate a possible resolution to persistent deficits. The study initiates a fresh avenue of research by evaluating the fiscal impact of privatization receipt. The factors that leads to persistent fiscal budget deficits and explain how empirical research on the fiscal impact of privatization would be a legitimate extension of this inquiry. For the long run and short run analysis Co-integration and VECM techniques are used. In present study it is found that there exist short run and long run relation among the macroeconomic variables, but the result of short run suggest that though there exists a short run relation the effects are not positive. Moreover, in the long run privatization caters only a minimal proportion of government expenditure. While Gross Domestic Product, Gross Fixed Capital Formation, GDP per Capita, Real Effective Exchange Rate, Unemployment have a positive and significant impact on government in the long run. Macroeconomic instability shows a negative impact in the long run. In short run the Gross Domestic Product, Gross Fixed Capital Formation and Real Effective Exchange Rate have significant positive impact while macroeconomic instability, GDP per Capita and Unemployment have no immediate impact in the short run. The study also confirms that there exist a causal relationship between Privatization and Government Expenditure


Keywords: Privatization; Fiscal Impact; VECM; Cointegration.
JEL Codes: H3; H62 ; C22.


[1] (Corresponding Author) Applied Economics Research Center. E-mail: aleem96@hotmail.com.