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. 2023 Nov 9;18(11):e0288532.
doi: 10.1371/journal.pone.0288532. eCollection 2023.

Does green innovation moderate between FDI and environmental sustainability? Empirical evidence from South Asia

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Does green innovation moderate between FDI and environmental sustainability? Empirical evidence from South Asia

Awais Ahmed Brohi et al. PLoS One. .

Abstract

The study aims to investigate how foreign direct investment (FDI) and green innovation (GI) impact environmental quality in South Asia. Moreover, this study examines the moderating role of GI between FDI and environmental sustainability. We use panel data from 1995 to 2018 for five South Asian nations namely, Pakistan, India, Bangladesh, Sri Lanka, and Nepal. For the empirical analysis, we used 1st generation cointegration like Pedroni and Kao, and 2nd generation cointegration tests like Westerlund. Moreover, for the long-run relationship, we employ fully modified least squares (FMOLS) and dynamic ordinary least squares (DOLS) estimation. The study's empirical results suggest that GI significantly enhances ecological sustainability in South Asian economies; however, FDI degrades the environmental quality. Furthermore, the results suggest that GI significantly moderates the nexus of FDI and ecological sustainability in South Asia. It is recommended that South Asian countries increase green innovation with FDI so that environmental quality can be assured for the region's sustainable development.

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Conflict of interest statement

The authors have declared that no competing interests exist.

Figures

Fig 1
Fig 1. Box plot of variables deleted separate file uploaded with submission generated from pace.

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Publication types

Grants and funding

This study is funded by Professor Yoshihisa Suzuki who contributed in study design, data collection and analysis, decision to publish.
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