The linkage between FDI and energy use in the case of emerging market economies

This article examines the relationship between energy use and foreign direct investment (FDI) in emerging market economies. Using panel GMM and panel 2SLS methods, the findings demonstrate that FDI positively influences energy use. A notable conclusion from the analysis is that FDI has a more pronounced long-term impact on energy consumption than in the short term, suggesting that its effects evolve over time. From a policy perspective, developing countries should strategically focus on attracting more FDI, particularly in the renewable energy sector.