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Foreign Direct Investment Location Decision and Pollution: Evidence from Malaysia

Jurnal Ekonomi Malaysia

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Title Foreign Direct Investment Location Decision and Pollution: Evidence from Malaysia
 
Creator Jaafar, Abdul Hamid
Hossain, Md. Elias
 
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Description ABSTRACTThere 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 invesbnent location decision acrossregions 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 eflects panel regression model. Results ffom this study indicatethat 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 chanceof attracting foreign as well as local investment.ABSTRAKKetakseimbangan wilayah yang berlaku di Malaysia agakmembimbangkan. Objektif kertas ini adalah untuk mengkaji kesan pencemaran alam sekitar di peringkat wilayah terhadap penempatan pelaburan langsung asing rnengikut wilayah di Malaysia. Dalam kajianini beberapa pemboiehubah alam sekitar diambilkira sebagai faktor penentu keputusan penempatan pelaburan langsung asing. Kajian ini menggunakan data negeri bagi tempoh 1995-2004 dun diaplikasikan kepada model regresi panel kesan ralat. Hasil kajian ini menunjukkan keadaan ekonomi yang baik menarik pelaburan langsung asing, manakala keadaan alam sekitar yang negatif seperti pencemaran air bertindak sebagai faktor penolak. Hasil kajian ini mencadangkan supaya setiap wilayah  memperbaiki keadaan alam sekitar mereka untuk menarik lebih ramai pelabur asing dan juga pelabur tempatan.
 
Publisher Universiti Kebangsaan Malaysia
 
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Date 2007-12-31
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
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Format application/pdf
 
Identifier http://ejournal.ukm.my/jem/article/view/1587
 
Source Jurnal Ekonomi Malaysia; Vol 41 (2007): Jurnal Ekonomi Malaysia
0126-1962
 
Language eng
 
Relation http://ejournal.ukm.my/jem/article/view/1587/1372
 
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