Publication

This paper examines the influence of foreign direct investment (FDI) inflows on energy intensities of developing countries. The authors first show that a simple OLS estimation suggests energy intensity reductions from FDI inflows, which is consistent with the hypothesis of energy saving technology transfer via FDI. They argue, however, that such a regression turns out to be spurious and only a starting point for further research. Therefore, they use macro level data on 60 developing countries for the period 1975-2004 including other potential determinants of energy intensities and apply panel estimation techniques and tests.