Analyzing the linkage between military spending, economic growth, and ecological footprint in Pakistan: evidence from cointegration and bootstrap causality

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Foreign direct investments can exert ambiguous effects on the environmental quality of the host economies. At the same time, terrorism is a worldwide phenomenon that affects human life, FDI inflows, economic growth, and, most importantly, environmental well-being. Hence, it can be expected that there are relationships between terrorism, foreign direct investment inflows, and carbon dioxide emissions. However, in the previous literature, less attention has been given to explore these nexuses. In addition, the possible nonlinearities in data are also mostly ignored in the preceding related studies. Against this backdrop, this paper explores the linear and nonlinear influences of terrorism and foreign direct investment inflows on carbon dioxide emissions, controlling for energy consumption and economic growth within the model, on carbon dioxide emissions in the context of ten global economies that are most impacted by terrorism. To this end, we used the data from 1973 to 2016 and deployed the linear and non-linear autoregressive distributed lag methods to scrutinize the environmental impacts of the explanatory variables of concern. The results confirmed the presence of non-linearities in the relationships between terrorism, inflows of foreign direct investments, and carbon dioxide emissions. Furthermore, the findings revealed that the positive shocks to terrorism and foreign direct investment inflows significantly deteriorate the environment with a dominating effect. Unlike the previous studies, this current study validates the pollution haven hypothesis for the sample economies. Energy consumption and economic growth were also evidenced to exacerbate the carbon dioxide emission levels in all selected countries. Based on these results, we recommend that our sample economies should focus on promoting education, employment, economic stability, and public awareness to eradicate terrorism which, in turn, can mitigate the emissions of carbon dioxide further. In addition, stringent environmental regulations on foreign direct investment inflows are required to reduce the adverse environmental effects of such sources of foreign finance. Furthermore, the international firms should be encouraged to invest in cleaner technologies by offering them tax benefits and other financial incentives.

Section: Literature Reviewmentioning

confidence: 94%

The asymmetric associations between foreign direct investment inflows, terrorism, CO2 emissions, and economic growth: a tale of two shocks

Chishti

Ahmed

Murshed

et al. 2021

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“…The reasons why the aforementioned parameters are incorporated are discussed here. In the past two decades, numerous scholars (Kirikkaleli et al 2020 ; Ahmed et al 2020a , b ; Alola et al 2020 ; Shahbaz et al 2020 ) have explored these interconnections. Nevertheless, prior studies did not incorporate CCO 2 emissions as a proxy of environmental degradation.…”

Section: Methodsmentioning

confidence: 99%

“…This test is utilized to affirm whether the linear or non-linear modeling is suitable for the study. Several recent studies such as Odugbesan and Adebayo ( 2020 ), Ahmed et al ( 2020a , b , c ), and Sheikh et al ( 2020 ) utilized the BDS test developed by Brock et al ( 1996 ). The null and alternative hypotheses of the BDS test are linearly dependence and non-linearly dependence.…”

Section: Methodsmentioning

confidence: 99%

“…In a bid to curb the carbon emissions from fossil fuels, renewables such as wind, solar, hydro, and geothermal have been identified as potential ways of substituting fossil fuels, thus reducing the excessive emissions (Chiu et al 2009 ; Ahmed and Le 2021 ). These variables have been considered at country, regional, and cross-sectional levels to explore their climate change involvement (Ahmed et al 2020a , b ). Zhang and Da, 2015 ; Liu et al 2015 ; Yu et al 2012 ; Mi et al 2015 ; Adebayo and Kirikkaleli 2021 ).…”

Section: Literature Reviewmentioning

confidence: 99%

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Determinants of consumption-based carbon emissions in Chile: an application of non-linear ARDL

Adebayo

Udemba

Ahmed

et al. 2021

Self Cite

136

In recent years, a growing number of scholars have employed various proxies of environmental degradation to understand the reasons behind rising environmental degradation. However, very few studies have considered consumption-based carbon emissions, even though a clear understanding of the impact of consumption patterns is essential for redirecting the pattern to more sustainable consumption. Thus, this study takes a step forward by using consumption-based carbon emissions (CCO 2 ) as a proxy of environmental degradation using the novel non-linear ARDL technique for Chilefrom 1990 to 2018. To the best understanding of the investigators, no prior studies have investigated the drivers of consumption-based carbon emissions utilizing non-linear ARDL. The study employed ADF and KSS (non-linear) tests to check the data series’ stationary level. Additionally, the symmetric and asymmetric ARDL approaches are utilized to explore cointegration and long-run linkages. According to the results, there is no symmetric cointegration among the variables; however, the empirical estimates reveal a long-run asymmetric connection between the indicators and CCO 2 emissions. The novel results from the asymmetric ARDL indicate that negative and positive changes in economic growth deteriorate the quality of the environment. Interestingly, a reduction in economic growth makes a more dominant contribution to environmental degradation. Moreover, positive changes in renewable energy usage improve the quality of Chile’s environment, inferring that the country can achieve a reduction in environmental degradation by boosting renewable energy consumption. Surprisingly, the study found that technological innovation is ineffective in reducing consumption-based carbon emissions, which implies that Chile’s technological innovation is not directed towards manufacturing green technology. Finally, the policy implications are discussed with respect to reducing consumption-based carbon emissions.

“…However, CO 2 emissions as a proxy of environmental deprivation do not deliberate the resources, i.e., forest, fishing, oil, mining, and soil (Ulucak and Apergis 2018). In this circumstance, ecological footprint (EF) is widely known as a more inclusive indicator of environmental degradation (Dogan et al 2020;Usman and Hammar 2020;Kirikkaleli et al 2020;Ahmed et al 2020). The EF is contained of six different kinds of areas such as forest land, fishing grounds, cropland, carbon footprint, grazing land and build-up land that describe the wide concept of environmental quality.…”

Section: Introductionmentioning

confidence: 99%

Remittance inflows affect the ecological footprint in BICS countries: do technological innovation and financial development matter?

Yang

Jahanger

Ali

2021

206

This study examines the impact of remittance inflows, technological innovations, and financial development on environmental quality in Brazil, India, China, and South Africa (BICS) economies over 1990-2016. This study employed a comprehensive environment proxy, i.e., ecological footprint for environmental quality, and also considers more advanced and robust econometric (second-generation) techniques. The outcomes of the current study reveal that remittance inflows and financial development significantly deteriorate the environmental quality, while technological innovations are an essential factor for the reduction of ecological footprint level. Furthermore, the results of the interaction terms show a significantly adverse effect on the ecological footprint. Additionally, the findings of country-wise analysis reveal that remittance inflows and financial development worsen the environmental quality in each sample country, while the technological innovations promote the environmental sustainability that is steady with panel results. Besides, the environmental Kuznets curve (EKC) hypothesis was verified across the BICS economies. Consistent with the key findings, an inverted U-shaped relationship exists between economic growth and ecological footprint in the case of Brazil and South Africa. In contrast, the U-shaped EKC hypothesis exists in the case of China and India. For robust policy implication, the findings of this study highlighted the dire need for "green policy tools" that should be linked with the BICS economy policies and driver for sustained growth.