Kiel Working Papers, Kiel Institute for World Economics
No 1393:
Energy Savings via FDI? Empirical Evidence from Developing Countries
Michael Hübler and Andreas Keller
Abstract: In this paper we examine the influence of foreign direct
investment inflows on energy intensities of developing countries
empirically. We first show that a simple OLS estimation, as it is found in
the literature, suggests energy intensity reductions from FDI inflows,
which is consistent with the hypothesis of energy saving technology
transfer via FDI. However, such a regression turns out to be spurious and
only a starting point for further research. Therefore, we use macro level
data on 60 developing countries for the period 1975-2004 including other
potential determinants of energy intensities and apply panel estimation
techniques and tests. The results do not confirm the hypothesis that FDI
inflows reduce energy intensities of developing countries in general.
Interactions of FDI with country-specific characteristics do not show
significant effects, either.
Keywords: developing countries, energy intensity, FDI, technology transfer; (follow links to similar papers)
JEL-Codes: F18,; F21,; O13,; O33,; Q43,; Q56; (follow links to similar papers)
27 pages, January 2008
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