Analytical tool for unpacking the driving forces of environmental impact: an IPAT analysis of Pakistan

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Analytical tool for unpacking the driving forces of environmental impact: an IPAT analysis of Pakistan Muhammad Tariq Majeed

. Sher Khan . Tasmeena Tahir

Accepted: 11 October 2020 Ó Springer Nature B.V. 2020

Abstract The continuous increase in carbon dioxide (CO2) emission leads to an adverse climate change, that has a disastrous impact on the socio-economic lives of the human being. Therefore, to reduce the environmental impact on human life, it is necessary to provide mitigation measures for CO2 emissions and to investigate the influence of pre-determined factors such as population, affluence, and technology (IPAT) on the environment. Hence, the current study is undertaken to ascertain the impact of the IPAT factors on environmental quality by using the Compound Annual Growth Rate (CAGR) and Log Mean Divisia Index (LMDI) decomposition techniques for Pakistan over the time period 1990–2014. The CAGR result exhibits that the 142.53 folds in CO2 emissions are driven by the population growth which is accompanied by the income growth, while the technological effect significantly decreased the growth of CO2 emissions by - 82.72 folds during 1990–2014, the energy induced CO2 emissions shows a negative growth rate during the study period that is attributed to the energy crises during most of the study years. M. T. Majeed (&)  S. Khan  T. Tahir School of Economics, Quaid-I-Azam University, Islamabad, Pakistan e-mail: [email protected] S. Khan e-mail: [email protected] T. Tahir e-mail: [email protected]

Besides, the LMDI decomposition technique shows that the impact of population and affluence leads to an increase in CO2 emissions. Furthermore, the technological effect helps to reduce CO2 emissions in all phases except phase 2 (1995–1999) where it has been identified as a significant contributor to CO2 emissions. Keywords analysis

CO2 emissions  Environment  IPAT

Introduction Global warming and adverse climate change have become an alarming threat to the world which is backed by the rapid increase of greenhouse gasses (GHGs) and because of these gasses, developing countries are facing the worst environmental conditions (Houghton et al. 1990; IPCC 1991). The intensity of CO2 emissions in the GHGs is the major factor that increases the earth’s temperature. In addition, it also affects water and land quality, ended up with the intensification of extreme floods, water insecurity, and high temperature that lead to the socio-economic instability of the nations (Naqvi et al. 2014). Economic activities lead to an increase in employment, income, urbanization, and other socio-economic drivers in the developed as well as developing

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countries. However, in developing countries such as Pakistan, these economic activities also lead to the modernization of the country but at the cost of higher GHG emissions. These economic activities are supported by investments in heavy construction and industrial manufacturing that also play a vital role in the increase