The role of financial development, tourism, and energy utilization in environmental deficit: evidence from 20 highest em
- PDF / 650,045 Bytes
- 16 Pages / 595.276 x 790.866 pts Page_size
- 25 Downloads / 149 Views
RESEARCH ARTICLE
The role of financial development, tourism, and energy utilization in environmental deficit: evidence from 20 highest emitting economies Muhammad Usman 1 & Rakhshanda Kousar 2 & Muhammad Sohail Amjad Makhdum 1 Received: 13 January 2020 / Accepted: 20 July 2020 # Springer-Verlag GmbH Germany, part of Springer Nature 2020
Abstract This study establishes a long-run relationship between ecological footprint, financial development, energy utilization, and tourism in 20 highest emitting economies under the environmental Kuznets curve (EKC) framework by utilizing the longitudinal data covering the period from 1995 to 2017. In the procedure of panel data estimation, conventional methodologies usually overlook the problem of cross-sectional dependence and heterogeneity across cross-sections. The other concern linked to the published literature is that only a small number of studies have estimated the effect of financial development and tourism on the environment in the presence of EKC framework simultaneously, even though these sectors have potentially substantial impact on environmental quality. To bridge these analyzed gaps, this study employs two different unit root tests: Cross-section Augmented Dickey Fuller (CADF) and Crosssection Augmented Im, Pesaran and Shin (CIPS) to confirm that the series are stationary at first difference after confirming the crosssectional dependency. Westerlund cointegration test applied to confirm the long-run association among variables. Augmented mean group (AMG) results discovered that financial development and the energy utilization significantly enhance the pollution level, while tourism sector reduces the environmental deficit. Moreover, these findings do not validate the EKC hypothesis. Based on the empirical findings, multiple policy implications are suggested to control and reduce the environmental degradation without hindering economic growth and development for the underlying highest emitting countries. Keywords Ecological footprint . Financial development index . Tourism . EKC hypothesis . AMG . Highest emitting countries
Introduction In the current decade, two major challenges of the world include sustainable economic development and stabilizing the environmental quality. The environmental quality has come to
Responsible Editor: Eyup Dogan * Muhammad Sohail Amjad Makhdum [email protected] Muhammad Usman [email protected] Rakhshanda Kousar [email protected] 1
Department of Economics, Government College University Faisalabad, Faisalabad 38000, Pakistan
2
Faculty of Social Sciences, Institute of Agricultural and Resource Economics, University of Agriculture Faisalabad, Faisalabad 38000, Pakistan
the leading contemporary dilemma for both developing as well as developed economies, increasing the level of greenhouse gases (GHGs) in the atmosphere. This is also responsible for the depletion of ozone layer and increase in the average global temperature. The environmental degradation is accountable for several human diseases such as stroke,
Data Loading...
