Mutual Influence of Energy Consumption and Foreign Direct Investment on Haze Pollution in China: a Spatial Econometric Approach

Based on the data of annual average values of PM10 concentrations in China, this study empirically investigates the spatial autocorrelation of haze pollution in China and the mutual influence of energy consumption and foreign direct investment on haze pollution in China from 2004 to 2014 using the spatial econometric method. Moran's I values are all above 0 during the 10 years, which indicates that haze pollution in China exists with significant spatial autocorrelation. Then the spatial econometric model estimation results show that energy consumption has a significant and positive effect on haze pollution in China while foreign direct investment has a significant and negative effect on haze pollution. Meanwhile, the regression coefficient of mutual variable of energy consumption and foreign direct investment is 0.063 at the 5% level, which suggests that foreign direct investment plays an important role in regulating the relationship between energy consumption and haze pollution, namely that the aggravation effect of energy consumption on haze pollution will increase with the increase of foreign direct investment. Finally, we provide some policy guidance for controlling haze pollution in China.