The role of foreign direct investments, urbanization, productivity, and energy consumption in Finland’s carbon emissions: an ARDL approach

Abstract

This study investigates the effects of productivity, energy consumption, foreign direct investments, and urbanization on carbon dioxide emissions (CO2) in Finland during 2000–2020 using an autoregressive distributed lag (ARDL) model. The results show that (i) there is evidence of cointegration among variables; (ii) energy consumption has a positive effect on CO2 emissions in the long run; (iii) labor productivity and urbanization have a negative effect on CO2 emissions in the long run; (iv) foreign direct investments are not a significant explainer of CO2 emissions. The results are discussed with some policy implications and suggested future research.