Foreign Direct Investment, Industrial Energy Efficiency, and the Green Economy

다국어 초록 (Multilingual Abstract)

This study investigates how foreign direct investment (FDI) contributes to green economic development by examining the underlying transmission mechanisms and the conditions under which these mechanisms are strengthened or weakened. Moving beyond the traditional static debate on whether FDI improves environmental performance, this paper focuses on the dynamic question of how and under what conditions FDI-generated technological spillovers are transformed into green economic outcomes. Using panel data for OECD countries, this study proposes and empirically tests a structural transmission framework in which industrial energy efficiency (IEE) serves as a key mediating channel linking FDI to the green economy (GE). The analysis further incorporates two external conditions: electricity price change (ΔPrice), representing market cost pressures and price instability, and government green R&D budgets (GRD), capturing policy support and technological absorption capacity. Rather than treating these factors as direct determinants of green outcomes, the study examines how they moderate the effectiveness of the FDI → IEE → GE transmission pathway. The empirical results indicate that FDI promotes green economic development primarily through improvements in industrial energy efficiency. However, large electricity price changes weaken both the absorption of FDI-related technologies and the conversion of efficiency gains into green economic performance along the FDI → IEE → GE transmission pathway. In contrast, government green R&D investment strengthens these transmission mechanisms by enhancing absorptive capacity and reducing the risks associated with technology adoption. Moreover, green R&D support partially offsets the adverse effects of electricity price changes, highlighting a joint moderation effect between market conditions and policy support. Overall, the findings demonstrate that the green impact of FDI is not automatic but highly conditional on market cost environments and policy frameworks. By clarifying the mediating role of industrial energy efficiency and the moderating roles of electricity price dynamics and green R&D investment, this study provides new insights into the mechanisms and boundary conditions through which FDI contributes to green economic development.

목차 (Table of Contents)

• Chapter 1 Introduction 1
• 1.1 Research Background 1
• 1.2 Research Objectives and Questions 4
• 1.3 Research Motivation and Significance 5
• 1.4 Conceptual Framework and Analytical Logic 9
• 1.5 Paper Structure 11
• Chapter 2 Literature Review 14
• 2.1 FDI and the Green Economy: 14
• 2.2 Energy Efficiency: 17
• 2.3 Green Economy: 21
• 2.4 Energy Price Signals 25
• 2.5 Government R&D Budgets: 27
• 2.6 Literature Synthesis and Research Positioning: Toward an Integrated “Mediation-Dual Moderation-Joint Moderation” Framework 32
• Chapter 3 Theoretical Model and Research Hypotheses 41
• 3.1 The Structural Transmission Pathway of FDI–IEE–GE 41
• 3.2 The Mediating Role of Industrial Energy Efficiency: How FDI Influences the Green Economy 44
• 3.3 The Modulating Role of Electricity Price Changes (ΔPrice): Impact Mechanisms of Cost Pressures and Uncertainty 49
• 3.4 The Modulating Role of Green R&D Budget (GRD): Mechanisms for Strengthening Policy Support 55
• 3.5 Joint Moderation Effect of Electricity Price Changes and Government Green R&D Investment (ΔPrice × GRD H10) 60
• 3.6 Econometric Model Specification 64
• 3.7 Summary 68
• Chapter 4. Research Design and Methodology 74
• 4.1 Research Approach and Design Logic 74
• 4.2 Data Sources 76
• 4.3 Explanatory Variables and Dependent Variables 78
• 4.4 Data Sources and Methodology 81
• (1) Foreign Direct Investment (FDI) 82
• (2) Industrial Energy Efficiency (IEE) 82
• (3) Green Economy Index (GE) 83
• (4) Control Variables 86
• 4.5 Summary Statistics 88
• Chapter 5. Results 90
• 5.1 Impact of Foreign Direct Investment on Industrial Energy Efficiency (H1) 90
• 5.1.1 Impact of Industrial Energy Efficiency on Green Economy (H2) 91
• 5.1.2 Mediating Role of Industrial Energy Efficiency: FDI and the Green Economy (H3) 93
• 5.2 Moderating Effects of Electricity Price Changes (H4–H6) 95
• 5.3 Moderating Effects of Green R&D Investment (H7–H9) 101
• 5.4 Joint Moderating Effect of Electricity Price Changes and Green R&D Investment (H10) 107
• 5.5 Dual Interaction Model 110
• 5.8 Chapter Summary 123
• Chapter 6: Analysis and Discussion of Economic Mechanisms 126
• 6.1 Mechanism of Foreign Direct Investment on Industrial Energy Efficiency (H1) 126
• 6.2 Transmission Mechanisms of Industrial Energy Efficiency in Promoting the Green Economy (H2) 127
• 6.3 Mediating Role of Industrial Energy Efficiency: FDI → GE (H3) 127
• 6.4 Mechanisms Through Which Electricity Price Changes Weaken the Conversion of Industrial Energy Efficiency into Green Economic Performance (H4–H6) 128
• 6.5 Mechanisms by Which Green R&D Expenditures Enhance Efficiency and Investment Green Effects (H7–H9) 129
• 6.6 Joint Moderation Mechanism of Electricity Price Changes and Green R&D Investment (H10) 130
• 6.7 Summary of Chapter Discussions 131
• Chapter 7: Conclusions and Policy Implications 133
• 7.1 Key Findings 133
• 7.2 Policy Implications 134
• 7.3 Research Limitations and Future Directions 137
• References 139
• Chinese Reference 144