The Environmental Kuznets Curve (EKC) hypothesis posits an inverted-U relationship between pollution emissions and economic growth. This means that economic growth goes hand-in-hand with environmental pollution emissions until a turning point is reached where pollution emissions and economic growth begin to decouple. This study examined the nonlinear cointegrating relationship of pollution emissions with economic growth alongside select developmental variables to test the EKC hypothesis using a panel data sample comprising 34 Asian economies over the period 2001 to 2013. The study estimated panel Autoregressive Distributed Lag (ARDL) models in the forms of Pooled Mean Group (PMG) and Mean Group (MG) models, which were tested against one another using the Hausman specification test. For robustness checks, the same procedure was applied to disaggregated panel groupings by income classifications of Asian economies. The results reveal that the EKC hypothesis holds in the total Asia sample; but not robust across the disaggregated panel groups. Interestingly, the EKC holds only among the middle-income economies and not among the low-income and high-income economies. The turning point GDP in the Asian EKC was estimated to be within the range of US$ 32,003 to US$ 38,793 per capita, confirming that only Singapore, Japan, and the United Arab Emirates were the only economies to have transitioned towards the coveted second half of the EKC, while some economies like Hong Kong and Israel are almost at the turning point. These findings support the argument that majority of the Asian economies have not yet reached the ideal phase where economic growth decouples with environmental degradation.

We examined the non-linear relationship of carbon dioxide emissions (CO2) with economic growth and energy consumption using a panel data consisting of the ten ASEAN member states from 1960 to 2021. The order of integration of each series in the study were verified by the IPS test, Fisher-ADF test, and the Fisher-PP test. The existence of a cointegrating relationship between the variables being studied were verified by the Kao test and the Pedroni test. We find strong empirical evidence supporting the validity of the Environmental Kuznets Curve hypothesis in the ASEAN region, suggesting the existence of a per capita income turning point which is approximately equal to USD 4,808.85. Upon reaching this point, CO2 emissions and economic growth in the ASEAN region will begin to decouple, implying the existence of an environmentally sustainable economic growth path beyond the turning point. The results of the study suggest that the ASEAN member states should design coordinated strategic plans to mitigate carbon dioxide emissions by promoting the use of renewable energy sources without compromising economic growth in the region. JEL classification: Q40, Q53, Q56