This chapter empirically investigates the dynamic effects of globalisation on carbon emission in developing countries across the globe, experiencing a high-speed engine of…
Abstract
This chapter empirically investigates the dynamic effects of globalisation on carbon emission in developing countries across the globe, experiencing a high-speed engine of globalisation over the last two decades. The allied existing literature discussed this issue mainly from the angles of economic expansions and integration of the global economy. However, some relevant factors like trade, financial, interpersonal and informational issues and cultural and politics should be highlighted in order to explore their possible influences on the high rate of carbon emission in the developing world under the modern epoch of globalisation. In this regard, this chapter utilises the World Bank World Development Indicators (WDI) (2020) and KOF Globalisation Index (2020) databases on selected 75 developing nations over the period of 2001–2018 to employ the dynamic panel econometric methods. The robust difference in generalised method of moments (GMM) estimates implies that trade is more harmful to high levels of carbon emissions in developing economies than all other components of globalisation.
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Nikola Vasilić, Sonja Đuričin and Isidora Beraha
Due to excessive carbon dioxide emissions, the world is facing environmental devastation. Energy and environmental innovations are considered to be critical tools in combating the…
Abstract
Due to excessive carbon dioxide emissions, the world is facing environmental devastation. Energy and environmental innovations are considered to be critical tools in combating the growing CO2 emissions. Developing these innovations requires extremely high investments in research and development processes, where knowledge is generated as one of the important outputs. This knowledge serves as a basis for innovation development and raising awareness among all relevant stakeholders about excessive environmental degradation. One of the significant sources of knowledge is scientific publications. Therefore, the aim of this research is to examine whether increased CO2 emissions stimulate the scientific community to publish a greater number of papers, as well as whether the knowledge contained in these publications is utilized in reducing CO2 emissions. The sample consists of G7 member countries. The time frame of the research is 1996–2019. The dynamic properties of the vector autoregression (VAR) models were summarized using impulse response function and variance decomposition forecast error. In most G7 countries, it has been determined that an increase in scientific production in environmental science and energy leads to a reduction in CO2 emissions. On the other hand, increased CO2 emissions affect higher scientific productivity in environmental science and energy only in Canada.
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Dinkneh Gebre Borojo, Jiang Yushi and Miao Miao
This study is aimed to examine the effects of the economic policy uncertainty (EPU) on carbon dioxide (CO2) emissions. It further aimed to investigate the moderating role of…
Abstract
Purpose
This study is aimed to examine the effects of the economic policy uncertainty (EPU) on carbon dioxide (CO2) emissions. It further aimed to investigate the moderating role of institutional quality on the impacts of EPU on CO2 emissions.
Design/methodology/approach
The authors apply the two-step system-generalized method of moments (GMM) for 112 emerging economies and low-income developing countries (hereafter, developing countries) for the period 2000–2019.
Findings
The findings reveal that the effects of EPU on CO2 emissions are positive. Specifically, a percent increase in EPU results in a 0.047% increase in CO2 emissions in developing countries. However, the effects of institutional quality on CO2 emissions are negative, certifying that strong institutional quality reduces emissions. Also, the results confirm that the positive effect of EPU on CO2 emissions is weaker in countries with relatively strong institutional quality.
Practical implications
Policymakers should be more vigilant while designing and implementing economic policies. Also, the government should support firms investing in environment-friendly innovations during high EPU. Besides, developing countries should improve institutional quality to mitigate the effect of EPU on CO2 emissions.
Originality/value
This study is the first in its kind to examine the impacts of EPU on CO2 emissions in developing countries. It also provides a different viewpoint on the EPU–CO2 relationship and reinterprets it through the moderating role of institutional quality.
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Muhammad Shahbaz and Avik Sinha
The purpose of this paper is to provide a survey of the empirical literature on environmental Kuznets curve (EKC) estimation of carbon dioxide (CO2) emissions over the period of…
Abstract
Purpose
The purpose of this paper is to provide a survey of the empirical literature on environmental Kuznets curve (EKC) estimation of carbon dioxide (CO2) emissions over the period of 1991–2017.
Design/methodology/approach
This survey categorizes the studies on the basis of power of income in empirical models of EKC. It has been hypothesized that the EKC shows an inverted U-shaped association between economic growth and CO2 emissions.
Findings
For all the contexts, the results of EKC estimation for CO2 emissions are inconclusive in nature. The reasons behind this discrepancy can be attributed to the choice of contexts, time period, explanatory variables, and methodological adaptation.
Research limitations/implications
The future studies in this context should not only consider new set of variables (e.g. corruption index, social indicators, political scenario, energy research and development expenditures, foreign capital inflows, happiness, population education structure, public investment toward alternate energy exploration, etc.), but also the data set should be refined, so that the EKC estimation issues raised by Stern (2004) can be addressed.
Originality/value
By far, no study in the literature of ecological economics has focused on the empirical estimation of EKC for CO2 emissions. This particular context has been used for this study, as CO2 is one of the highest studied pollutants in the ecological economics, and especially within the EKC hypothesis framework.
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Bappaditya Biswas and Abhijeet Bag
It is a well-known fact that economic development and rise in the volume of trade due to globalization have led to more production which has further led to the increase in the…
Abstract
It is a well-known fact that economic development and rise in the volume of trade due to globalization have led to more production which has further led to the increase in the emission of carbon dioxide in the environment. Under the backdrop, the aim of this chapter is to examine the relationships among per capita CO2 emissions as the proxy for exploitation of the environment with international trade and per capita GDP in India. It analyzed cointegration and short-run causal relationships between the variables based on a time series data set for the period of 1979–2018. The data found to be stationary at first integration; hence the researchers ran cointegration. The study found that the carbon emissions are an outcome of economic growth and more and more trade with the foreign countries.
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Prema‐chandra Athukorala and Shahbaz Nasir
The purpose of this paper is to examine patterns and determinants of trade among developing countries (South‐South trade), with emphasis on the role of production sharing in…
Abstract
Purpose
The purpose of this paper is to examine patterns and determinants of trade among developing countries (South‐South trade), with emphasis on the role of production sharing in global economic integration of the Southern economies.
Design/methodology/approach
The paper begins with an analytical narrative of the emerging trends and patterns of South‐South trade using a classification system that helps delineating trade based on global production sharing (network trade) from total recorded trade. Then it undertakes a comparative econometric analysis of the determinants of South‐South and South‐North trade using the standard gravity model.
Findings
The share of South‐South trade in world trade has shown a significant increase over the past two decades. This increase has predominantly come from the dynamic East Asian countries, reflecting their growing engagement in global production sharing. The growth dynamism of East‐Asia centered production networks depends heavily on demand for final (assembled) goods in the Northern markets; South‐South trade is largely complementary to, rather than competing with, South‐North trade. While regional trading agreements (RTAs) could play a role at the margin, natural economic forces associated with growth and structural change in the economy and the overall macroeconomic climate as reflected in the real exchange rate, and the quality of trade related logistics are far more important in the expansion of South‐South network trade.
Originality/value
This is the first study to examine patterns and determinants of South‐South trade paying attention to the role of global production sharing. The findings are valuable for informing the contemporary policy debate on promoting South‐South trade. The trade data classification system developed here is expected to help further research on this subject.
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Eric B. Yiadom, Lord Mensah and Godfred A. Bokpin
This study aims to decompose financial development into its three key components (depth, access and efficiency) to investigate whether they can help to overturn the negative…
Abstract
Purpose
This study aims to decompose financial development into its three key components (depth, access and efficiency) to investigate whether they can help to overturn the negative impact of foreign direct investment (FDI) on the environment.
Design/methodology/approach
The study uses a dynamic panel of 43 economies from 1982 to 2018 and decomposed financial development into its three key components: depth, access and efficiency.
Findings
The results from the various estimations indicate that financial deepening and efficiency reduce environmental risk and can overturn the negative impact of FDI on the environment. In addition, the study finds that low levels of financial access worsen environmental risk but doubling financial access is likely to reduce it which makes the relationship between access and environmental risk non-monotonic. After splitting the data set into high and low financially developed economies, the study reports that FDI is more environmentally depressive among low financially developed economies.
Practical implications
The practical implications are that improvement in financial efficiency guarantees high returns on savings and investment and can reduce environmental risk. So, central governments should invest in financial technologies and formulate financial regulations through monetary and fiscal policies to enhance financial efficiency and depth.
Social implications
If inward FDI to Africa continues the business-as-usual trend, the environmental risk in the region may continue to rise, environmental conditionalities for FDI must be strengthened.
Originality/value
The study uses a comprehensive measure of financial sector development and decomposes financial development indicators to assess their efficacy in mitigating the relationship between FDI and environmental quality.
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Mosab I. Tabash, Umar Farooq, Suhaib Anagreh and Mamdouh Abdulaziz Saleh Al-Faryan
This study aims to explore the empirical relationship between public–private investment (PPI) in energy and environmental quality.
Abstract
Purpose
This study aims to explore the empirical relationship between public–private investment (PPI) in energy and environmental quality.
Design/methodology/approach
The authors hypothesize that PPI can reduce pollution emissions and test this hypothesis by sampling the 20-year data of emerging and growth-leading economies (EAGLE) and adopting two estimation techniques named panel estimated generalized least square and fully modified ordinary least square models.
Findings
The empirical analysis vows that PPI has an inverse relationship with CO2 emissions, corroborating the sustainable development driving role of PPI. In addition, the empirical outcomes suggest a negative/positive role of energy imports and economic growth. Meanwhile, foreign direct investment is negatively linked with CO2 emissions, corroborating the pollution halo hypothesis in the case of EAGLE. However, financial development shows a positive relationship with CO2 emissions.
Practical implications
This study offers an important policy outlay regarding the pollution mitigation role of PPI in EAGLE. The environmental sustainability in underlying economies can be achieved by enhancing the magnitude of public–private cooperation in energy investment. The empirical analysis supplements cutting-edge empirical evidence regarding PPI as a driver of important sustainable development goal (SDG), i.e. environmental sustainability.
Originality/value
To the best of the authors’ knowledge, this study is the first study that examines how one can achieve an important SDG regarding environmental sustainability through PPI in energy.
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Festus Victor Bekun, Bright Akwasi Gyamfi, Mfonobong Udom Etokakpan and Burçin Çakir
This purpose of this study is to explore the impact of global trend of economic integration and interconnectedness which has drawn the attention of world economies and their…
Abstract
Purpose
This purpose of this study is to explore the impact of global trend of economic integration and interconnectedness which has drawn the attention of world economies and their implications on trade inflow. This trajectory has its impact, either positive/negative, on key macroeconomic indicators, to say the least on environmental sustainability, especially emerging economies. To this end, the need to explore the connection between foreign direct investment (FDI) inflow and energy consumption amidst the wave of economic globalisation is timely and pertinent for the case of Turkey.
Design/methodology/approach
This study seeks to explore the interaction between the outlined variables in a carbon-income framework for annual time series data from 1970 to 2016. A series of econometrics strategies was used consisting of unit root tests to examine the stationarity properties of the highlighted series. Subsequently, Pesaran’s Bounds testing technique is used to explore the long-run equilibrium relationship between the highlighted variables in conjunction with the Johansen cointegration test. For long-run regression coefficients, Pesaran’s autoregressive distributed lag and dynamic ordinary least squares methodology are used, and innovative accounting approaches are used to explore the responsiveness of each variable on another.
Findings
Empirical results validate the pollution haven hypothesis (PHH) in the long run for the case of Turkey. Thus suggesting that FDI inflow induced environmental degradation in Turkey. Additionally, this study observed that renewable energy, on the contrary, improves the quality of the environment. This study also affirms the presence of the environmental Kuznets curve phenomenon, indicating that Turkey, at its early stage of economic trajectory, emphasis is on economic growth rather than environmental quality. This suggests a need for more deliberate action(s) by the government administrators to pursue cleaner FDI inflow and energy technologies and strategies to foster a clean environment in Turkey and a cleaner ecosystem at large.
Originality/value
This study is unique in its choice of variables which is in line with the United Nations Sustainable Development Goals (SDGs) agenda to be achieved by 2030 and is very limited in the extant literature. From the economic perspective, the effect of the PHH is of interest especially to ascertain the extent the interplay among the variables has on the economy of Turkey. The empirical insights on PHH hypothesis have received less documentation in the extant literature especially for emerging economy like Turkey. Thus, this study seeks to revisit this theme for Turkey with aim to presents environmentally sustainable strategies without compromise for economic growth. Thus, this study seeks to revisit this theme.
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This paper aims to investigate the effects of economic growth, population density and international trade on energy consumption and environmental quality in India.
Abstract
Purpose
This paper aims to investigate the effects of economic growth, population density and international trade on energy consumption and environmental quality in India.
Design/methodology/approach
Taking annual data of 1971-2011, autoregressive distributed lag bounds testing technique is applied to explore the long run link between the series. The Granger causality test is used to determine the direction of causality between the variables.
Findings
The obtained results confirm the cointegration of variables, and economic growth and population density are found to have significant positive effects on energy consumption in both the short and long runs. CO2 emissions are also positively and significantly affected by population density and energy consumption, and negatively affected by economic growth.
Originality/value
The paper is original and valuable in the sense that it has considered two relevant additional explanatory variables, namely, population density and trade openness, which got little attention in the past. This research is an improvement over the previous studies because it has looked at the separate effects of explanatory variables on energy consumption, in addition to the effects on carbon emissions. Therefore, the findings of this research are more reliable because this adopted methodology is better and extensive, and the authors have properly addressed the issue of omitted variable bias.