Reexamining the impact of foreign direct investment on carbon emissions: does per capita GDP matter?

Abstract Research on the impact of foreign direct investment (FDI) environmental quality has not reached consensus. This paper examines potential structural break in relationship between FDI and environment from perspective economic scale. The results panel threshold estimation for 67 countries different income groups show that carbon emissions shifts positive to negative at level stages, using GDP as threshold. conclusion is further verified by group regression robustness test. When per capita below $541.87, shows a significant emissions, this interval corresponds wide range low-income economies today, however, when exceeds almost disappears. manifests itself once reaches $46515, sample corresponding since 2014 are mainly Switzerland, Iceland, Denmark, Sweden, United States, Singapore, Australia. Therefore, we call raise their levels so they can cross lower thus take advantage emission reduction effect provided FDI.