Testing Linear and Nonlinear Relationships Between Foreign Direct Investment and Fossil Energy Consumption in Fragile Five Countries

Ali Çelik

Makale detayları

Testing Linear and Nonlinear Relationships Between Foreign Direct Investment and Fossil Energy Consumption in Fragile Five Countries

Yazarlar:

Ali Çelik

Yayıncı:

Istanbul University

Ana Başlıklar:

Ekonometri (Diğer)

Dergi:

EKOIST Journal of Econometrics and Statistics Issue 38, pp.1-17

Belge Tipi:

Makale

Yayın Tarihi:

7/2023

Belge Dili:

İngilizce

Document ID (Org No.):

2001293499

pISSN:

2651-396X

Anahtar kelimeler:

Özet:

 The global warming and climate change problem is causing severe threats for the present and the future. The excessive utilization of fossil energy resources, especially on the production side, has contributed greatly to global warming by producing the greenhouse effect. In this respect, it is essential to assess the impact of foreign direct investment FDI, which is expected to increase the production and employment of countries, on the utilization of fossil fuels. In this study, we investigate the relationship between FDI and fossil energy consumption EC utilizing such tests as: Johansen linear cointegration, Kapetanios, Shin, and Snell 2006 nonlinear cointegration, the linear Error Correction Model ECM, Exponential Smooth Autoregressive ESTAR ECM, Granger 1969 linear causality, and Diks and Panchenko 2006 nonlinear causality. In this context, annual data covering the period between 1980 and 2020 are employed for the Fragile Five countries, which are: Brazil, Indonesia, India, Turkey, and South Africa. By applying the Augmented Dickey Fuller ADF linear unit root test, we found that the series became stationary after taking the first difference. Following the unit root test results, Johansens 1988 linear cointegration test results indicated that there existed a cointegration relationship from FDI to EC for Turkey and South Africa, while Kapetanios, Shin, and Snells 2006 nonlinear cointegration test results revealed that there existed a cointegration relationship from FDI to EC in South Africa. In addition, the linear error correction model was proven to be valid for Turkey and South Africa, while the ESTAR nonlinear error correction model is valid only for Turkey. Finally, Grangers 1969 causality test results proved that there was a causal relationship from FDI to EC in Turkey. Dicks and Panchenko 2006 stated that there was no causal relationship between the variables.

 The global warming and climate change problem is causing severe threats for the present and the future. The excessive utilization of fossil energy resources, especially on the production side, has contributed greatly to global warming by producing the greenhouse effect. In this respect, it is essential to assess the impact of foreign direct investment FDI, which is expected to increase the production and employment of countries, on the utilization of fossil fuels. In this study, we investigate the relationship between FDI and fossil energy consumption EC utilizing such tests as: Johansen linear cointegration, Kapetanios, Shin, and Snell 2006 nonlinear cointegration, the linear Error Correction Model ECM, Exponential Smooth Autoregressive ESTAR ECM, Granger 1969 linear causality, and Diks and Panchenko 2006 nonlinear causality. In this context, annual data covering the period between 1980 and 2020 are employed for the Fragile Five countries, which are: Brazil, Indonesia, India, Turkey, and South Africa. By applying the Augmented Dickey Fuller ADF linear unit root test, we found that the series became stationary after taking the first difference. Following the unit root test results, Johansens 1988 linear cointegration test results indicated that there existed a cointegration relationship from FDI to EC for Turkey and South Africa, while Kapetanios, Shin, and Snells 2006 nonlinear cointegration test results revealed that there existed a cointegration relationship from FDI to EC in South Africa. In addition, the linear error correction model was proven to be valid for Turkey and South Africa, while the ESTAR nonlinear error correction model is valid only for Turkey. Finally, Grangers 1969 causality test results proved that there was a causal relationship from FDI to EC in Turkey. Dicks and Panchenko 2006 stated that there was no causal relationship between the variables.

 The global warming and climate change problem is causing severe threats for the present and the future. The excessive utilization of fossil energy resources, especially on the production side, has contributed greatly to global warming by producing the greenhouse effect. In this respect, it is essential to assess the impact of foreign direct investment FDI, which is expected to increase the production and employment of countries, on the utilization of fossil fuels. In this study, we investigate the relationship between FDI and fossil energy consumption EC utilizing such tests as: Johansen linear cointegration, Kapetanios, Shin, and Snell 2006 nonlinear cointegration, the linear Error Correction Model ECM, Exponential Smooth Autoregressive ESTAR ECM, Granger 1969 linear causality, and Diks and Panchenko 2006 nonlinear causality. In this context, annual data covering the period between 1980 and 2020 are employed for the Fragile Five countries, which are: Brazil, Indonesia, India, Turkey, and South Africa. By applying the Augmented Dickey Fuller ADF linear unit root test, we found that the series became stationary after taking the first difference. Following the unit root test results, Johansens 1988 linear cointegration test results indicated that there existed a cointegration relationship from FDI to EC for Turkey and South Africa, while Kapetanios, Shin, and Snells 2006 nonlinear cointegration test results revealed that there existed a cointegration relationship from FDI to EC in South Africa. In addition, the linear error correction model was proven to be valid for Turkey and South Africa, while the ESTAR nonlinear error correction model is valid only for Turkey. Finally, Grangers 1969 causality test results proved that there was a causal relationship from FDI to EC in Turkey. Dicks and Panchenko 2006 stated that there was no causal relationship between the variables.

 The global warming and climate change problem is causing severe threats for the present and the future. The excessive utilization of fossil energy resources, especially on the production side, has contributed greatly to global warming by producing the greenhouse effect. In this respect, it is essential to assess the impact of foreign direct investment FDI, which is expected to increase the production and employment of countries, on the utilization of fossil fuels. In this study, we investigate the relationship between FDI and fossil energy consumption EC utilizing such tests as: Johansen linear cointegration, Kapetanios, Shin, and Snell 2006 nonlinear cointegration, the linear Error Correction Model ECM, Exponential Smooth Autoregressive ESTAR ECM, Granger 1969 linear causality, and Diks and Panchenko 2006 nonlinear causality. In this context, annual data covering the period between 1980 and 2020 are employed for the Fragile Five countries, which are: Brazil, Indonesia, India, Turkey, and South Africa. By applying the Augmented Dickey Fuller ADF linear unit root test, we found that the series became stationary after taking the first difference. Following the unit root test results, Johansens 1988 linear cointegration test results indicated that there existed a cointegration relationship from FDI to EC for Turkey and South Africa, while Kapetanios, Shin, and Snells 2006 nonlinear cointegration test results revealed that there existed a cointegration relationship from FDI to EC in South Africa. In addition, the linear error correction model was proven to be valid for Turkey and South Africa, while the ESTAR nonlinear error correction model is valid only for Turkey. Finally, Grangers 1969 causality test results proved that there was a causal relationship from FDI to EC in Turkey. Dicks and Panchenko 2006 stated that there was no causal relationship between the variables.

Makale detayları

Testing Linear and Nonlinear Relationships Between Foreign Direct Investment and Fossil Energy Consumption in Fragile Five Countries

Yazarlar:

Ali Çelik

Yayıncı:

Istanbul University

Ana Başlıklar:

Ekonometri (Diğer)

Dergi:

EKOIST Journal of Econometrics and Statistics Issue 38, pp.1-17

Belge Tipi:

Makale

Yayın Tarihi:

7/2023

Belge Dili:

İngilizce

Document ID (Org No.):

2001293499

pISSN:

2651-396X

Foreign Direct Investment

Fossil Energy Consumption

Exponential Smooth Transition Autoregressive

Sayı

Makale detayları

Testing Linear and Nonlinear Relationships Between Foreign Direct Investment and Fossil Energy Consumption in Fragile Five Countries

Yazarlar: Ali Çelik

Yayıncı: Istanbul University

Ana Başlıklar: Ekonometri (Diğer)

Dergi: EKOIST Journal of Econometrics and Statistics Issue 38, pp.1-17

Belge Tipi: Makale

Yayın Tarihi: 7/2023

Belge Dili: İngilizce

Document ID (Org No.): 2001293499

pISSN: 2651-396X

Foreign Direct Investment

Fossil Energy Consumption

Exponential Smooth Transition Autoregressive

Sayı

Yazarlar:

Ali Çelik

Yayıncı:

Istanbul University

Ana Başlıklar:

Ekonometri (Diğer)

Dergi:

EKOIST Journal of Econometrics and Statistics Issue 38, pp.1-17

Belge Tipi:

Makale

Yayın Tarihi:

7/2023

Belge Dili:

İngilizce

Document ID (Org No.):

2001293499

pISSN:

2651-396X