An Empirical Research on the Relationship between Foreign Direct Investment and Carbon Dioxide Emission Intensity of China

Abstract

In this paper, the method of carbon emissions coefficient is used to have measured the total amount of CO2 emissions and to have calculated the CO2 emissions intensity of China from 1995-2010. The relationship between FDI and CO2 emissions intensity of China is also analyzed in the paper by means of cointegration test, error correction model and granger causality test. The results indicate that there is a long-term relationship between FDI and CO2 emissions intensity of China. Furthermore, the growth of FDI makes effect on CO2 emissions intensity of China, but CO2 emissions intensity of China doesnt make effect on the growth of FDI conversely.