Factors affecting the green economy: the mediating role of foreign direct investment

Abstract

Purpose

The objective of this study is to examine the various factors that exert an influence on the green economy. This study also investigates the impact of foreign direct investment (FDI) on the Malaysian economy, specifically focusing on its position as a mediator. This research also examines the correlation between FDI and its influence on the contemporary green economy.

Design/methodology/approach

The authors employed quantitative methodologies and a self-administered survey to evaluate data and derive a definitive conclusion. The result was constructed using SPSS and SEM-PLS as the analytical software.

Findings

The study reveals that technological advancement, investment country and government policy significantly and positively affect the green economy, catalyse SDG goals and restructure the economy in better shape.

Originality/value

The current empirical research bridges the research gap in the context of technology advancement in government policy from emerging economies by exploring important factors, proposing their impact on the performance of the green economy, and empirically testing those hypothesized relationships. This study deciphers that FDI influences the green economy, where the investment country plays a significant role. Also, for a graphical presentation of this abstract, see the online appendix.

Citation

Miraz, M.H. and Soo, T.S.M. (2024), "Factors affecting the green economy: the mediating role of foreign direct investment", Journal of Economic Studies, Vol. 51 No. 8, pp. 1613-1628. https://doi.org/10.1108/JES-01-2024-0012