An Empirical Analysis of the Relationship Between Multinational Enterprises and Sustainable Development of Energy Sector Under Institutional Voids

Paper presented at the Second WINIR Conference, 10-13 September 2015, Rio de Janeiro, Brazil

29 Pages Posted: 1 Feb 2018

See all articles by Emanuela Colombo

Emanuela Colombo

Polytechnic University of Milan

Matilde D'Amelio

Polytechnic University of Milan - Department of Management, Economics and Industrial Engineering

Paola Garrone

Politecnico di Milano

Lucia Piscitello

Politecnico di Milano - Dipartimento di Ingegneria gestionale

Date Written: July 1, 2015

Abstract

This article aims at assessing whether multinational enterprises play a role in the reduction of energy poverty, while not causing environment degradation or inefficient usage of energy resources. Sub-Saharan Africa has been identified as an ideal test-field for this study. Using a panel of more than 1500 home-host country pairs observed from 2005 and 2011, we study the effect of foreign direct investment on the access to electricity, energy intensity and carbon factor, based on the level of economic and institutional development of home and host countries. Results reveal that institutions and income play a different role. In countries with weak institutions, foreign direct investment increases access to electricity, especially if from other institutionally backward contexts, and transfers cleaner technologies. On the contrary, in poor countries, investment from multinational enterprise increases environmental degradation without bringing any benefit to the local energy sector.

Keywords: Access to electricity, energy intensity, carbon factor, sub-Saharan Africa, FDI, institutions

JEL Classification: F23, L94, O14, O55

Suggested Citation

Colombo, Emanuela and D'Amelio, Matilde and Garrone, Paola and Piscitello, Lucia, An Empirical Analysis of the Relationship Between Multinational Enterprises and Sustainable Development of Energy Sector Under Institutional Voids (July 1, 2015). Paper presented at the Second WINIR Conference, 10-13 September 2015, Rio de Janeiro, Brazil . Available at SSRN: https://ssrn.com/abstract=3108820 or http://dx.doi.org/10.2139/ssrn.3108820

Emanuela Colombo

Polytechnic University of Milan ( email )

Piazza Leonardo da Vinci
Milan, Milano 20100
Italy

Matilde D'Amelio

Polytechnic University of Milan - Department of Management, Economics and Industrial Engineering ( email )

Via Lambruschini 4C - building 26/A
Milano, 20156
Italy

Paola Garrone (Contact Author)

Politecnico di Milano ( email )

piazza Leonardo da Vinci 32
Milano, 20133
Italy
+39-02-23992742 (Phone)

Lucia Piscitello

Politecnico di Milano - Dipartimento di Ingegneria gestionale ( email )

20113 Milan, Milano
Italy

HOME PAGE: http://www.dig.polimi.it/eng/comunita/cl.php?id=51

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