KUZNETS CURVE TEST ON THE IMPACT OF FOREIGN DIRECT INVESTMENT TO THE CO2 EMISSIONS IN THE COUNTRIES OF SOUTH EAST ASIA

Abstract

In the slow developing countries, the pressure increase income per capita which forced the Government to swap between economic growth with environmental pollution. This study applies System Generalized Method of Moments and Pooled Mean Group Regression in combination with dynamic panel data to investigate the existence of Environment Kuznets Curve in ASEAN. The data was collected for the ASEAN-7 countries during the period from 1995 to 2014 from the International Engery Agency, World Bank’s database. This article provides a statistical evidence that overall there is the relationship, which has inverse U-shape between income per capita, foreign direct investment and environmental degradation. The turning point’s GDP per capita is about 46000 USD/year.