Identifying the Relationship between Environmental Degradation and Economic Growth: A Focus on the Environmental Impacts of Rice Cultivation in the Top Ten Rice-Producing Countries

Abstract

In this study, the environmental Kuznets curve (EKC) was tested for the first time in the agriculture sector of ten rice-producing countries namely China, India, Indonesia, Bangladesh, Vietnam, Thailand, Myanmar, Japan, the Philippines, and Brazil, using panel data from 1995 to 2018. Once the EKC was tested at the aggregate level, the results were compared with those of the model disaggregated by the agriculture sector. We examined the relationship between environmental degradation (i.e., PM2.5, PM10, and CH4 emitted during rice cultivation processes) and economic growth, as well as agricultural growth, alongside other explanatory variables. Employing panel econometrics techniques, there is evidence of the EKC with an inverted U-shaped at both aggregate and disaggregate models. Including additional environmental explanatory variables such as urbanization, population density, and financial development, our results are robust and significant. The validity of the inverted U-shaped EKC suggests that compact environmental legislation, efficient energy use, and green technologies can reduce emissions as the economy and agriculture sectors expand