Department of Economics

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Browsing Department of Economics by Author "Adam, Shehu Usman"

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    THE EFFECT OF FOREIGN DIRECT INVESTMENT AND MULTINATIONAL CORPORATIONS ON SUSTAINABLE DEVELOPMENT IN NIGERIA: HALO OR HAVEN? EMPHASIS ON CO2 ANTHROPOGENIC EMISSION
    (Universiti Kebangsaan Malaysia, 2010-10-15) Adam, Shehu Usman; Turkahan, Ali Abdul Manap
    Although data on single-country environmental indicators exist in short-span leading to the use of cross-section or panel data by most related studies, there has been attempts to understand country-specific analysis of FDI-Environment nexus. This study explores the relationship between FDI and the operations of Multinational Corporations (MNCs) on sustainable development in Nigeria- the major destination for FDI inflow to West Africa. Using CO2 emission as the measure of environmental degradation, we employ annual data spanning from 1970 through 2005 to investigate whether the “pollution haven” or “pollution halo” scenario holds in Nigeria. By applying the Autoregressive Distributed Lag (ARDL) approach to cointegration to examine the nature of the relationship, we found that FDI is negatively related to CO2 emission. This suggests a scenario of “pollution halo”; implying that if CO2 is considered a measure of environmental degradation, more FDI inflow is beneficial and compatible with sustainable development since we found no evidence for “pollution haven” for the aggregate FDI inflows to all sectors. We suggest future research in this area to employ sector-specific data on FDI inflow so that a direct delineation could be made between the environment-degenerating and environment-benign destinations of FDI inflows to Nigeria. Besides, other measures of environmental quality such as water pollution and the destruction to aquatic habitat, most especially in the South-South region of Nigeria, could also be explored since the result from this study may not be generalized for other measures of environmental quality (Deacon and Norman, 2006). The unique contribution of this study lies in the fact that, it is the first single-country focused study to examine FDI-Environment nexus for the case of Nigeria.