Open AccessAn analysis of the Pollution Haven Hypothesis in the context of Turkey: A nonlinear approach
Author(s) -
Mehmet Sinan Temurlenk,
Anıl Lögün
Publication year - 2022
Publication title -
economics and business review/the poznań university of economics review
Language(s) - English
Resource type - Journals
eISSN - 2392-1641
pISSN - 1643-5877
DOI - 10.18559/ebr.2022.1.2
Subject(s) - pollution haven hypothesis , haven , foreign direct investment , openness to experience , distributed lag , context (archaeology) , economics , pollution , developing country , environmental pollution , investment (military) , international economics , natural resource economics , macroeconomics , econometrics , environmental science , economic growth , environmental protection , political science , mathematics , psychology , social psychology , paleontology , ecology , combinatorics , biology , politics , law
Foreign direct investment (FDI) is an important driver of countries’ economic development. Factors such as looser environmental regulations may cause dirty FDI to flow mainly to developing countries. This is explained by the Pollution Haven Hypothesis. The paper aims to investigate whether the Pollution Haven Hypothesis is valid in Turkey using the nonlinear autoregressive distributed lag (NARDL) approach for the period 1974–2017. The results show that FDI inflows and carbon emissions have asymmetric effects in both the short and long term for Turkey, supporting the Pollution Haven Hypothesis. Furthermore, there is a link between carbon emissions and trade openness, manufacturing and economic growth. Policymakers should develop the policies necessary to transfer clean technologies to Turkey by providing improvements and technical advances for a more efficient energy use.