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Impact of Chinese OFDI on Developing the Green Economy in Countries Along the Belt and Road

Author(s)

Xinlei Zhou, Ji Hao, Xu Jing

Affiliation(s)

Xi'an International Studies University, Xi'an, Shaanxi, China

Abstract

Since the inception of the Belt and Road Initiative, the green economy of countries along the route has undergone continuous development, and China's outward direct investment (OFDI) has played an instrumental role in promoting the development of green economy in these countries. This paper utilizes entropy weight-TOPSIS to assess the degree of green economy development in 52 sample countries along the Belt and Road from 2011 to 2021. The study utilizes a panel regression model to examine the impact of OFDI on the green economy's development in these countries. The study also examines the heterogeneity of economic income and regional differences. Furthermore, the study delves into the non-linear impact of the labor force's level on OFDI's promotion of green economy development. The findings of the study indicate that OFDI can substantially encourage the green economic development of countries along the route, exhibiting significant heterogeneity between specific regions and low-income and lower-middle-income countries. As the labor force expands, the role of OFDI in influencing the impact of green economic development becomes more significant.

Keywords

Green Economy; Belt and Road; Threshold Effect; Outward Direct Investment

References

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