Foreign direct investment location decision and pollution

Evidence from Malaysia

Abdul Humid Jaafar, Md Elias Hossain

    Research output: Contribution to journalArticle

    Abstract

    There is considerable development gap between regions in Malaysia. The objective of this paper is to examine the impact of regional environmental pollution condition on foreign direct investment location decision across regions in Malaysia. In this study, several regional environmental variables are included as determinants of foreign direct investment location decision. The study uses state level data from 1995 to 2004 on a random effects panel regression model. Results from this study indicate that while positive economic circumstances attract foreign direct investment, negative environmental conditions, especially air pollution, serve as push factors. This finding suggests that local regions should improve their environmental condition in order to stand a better chance of attracting foreign as well as local investment.

    Original languageEnglish
    Pages (from-to)135-145
    Number of pages11
    JournalJurnal Ekonomi Malaysia
    Volume41
    Publication statusPublished - 2007

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    Foreign direct investment
    Pollution
    Location decision
    Malaysia
    Environmental conditions
    Environmental pollution
    Panel regression
    Air pollution
    Factors
    Regional studies
    Regression model
    Random effects
    Economics

    ASJC Scopus subject areas

    • Business, Management and Accounting (miscellaneous)

    Cite this

    Foreign direct investment location decision and pollution : Evidence from Malaysia. / Jaafar, Abdul Humid; Hossain, Md Elias.

    In: Jurnal Ekonomi Malaysia, Vol. 41, 2007, p. 135-145.

    Research output: Contribution to journalArticle

    Jaafar, Abdul Humid ; Hossain, Md Elias. / Foreign direct investment location decision and pollution : Evidence from Malaysia. In: Jurnal Ekonomi Malaysia. 2007 ; Vol. 41. pp. 135-145.
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