The Causal Relationship between Government Spending and Environmental Quality: The Case for Bangladesh

Morshed, Akm Mahbub; Porna, Aroni Kabita; Amin, Sakib Bin

doi:10.21102/jbpr.2018.07.131.08

Cited by 4 publications

(1 citation statement)

References 15 publications

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“…While the findings from the mentioned studies indicate a potential mitigating effect of fiscal policy on environmental pollution through public expenditures, it's worth noting that contrary results are also possible in other studies. For instance, Morshed et al (2018) examined the period 1974-2014 for Bangladesh and concluded that public expenditures negatively impact air quality in the long run. Yuelan et al (2019) identified, in the case of China covering the data period 1980-2016, that expansionary fiscal policy contributes to increased environmental degradation.…”

Section: Literature Reviewmentioning

confidence: 99%

Maliye Politikalarının Çevresel Bozulmaya Asimetrik Etkisi: Türkiye için NARDL Modelinden Kanıtlar

DEMİR

2023

Bucak İşletme Fakültesi Dergisi

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In this study, an analysis based on the NARDL model has been conducted using data from 1970 to 2020 to investigate the impact of fiscal policy tool, public expenditures, on environmental degradation. This approach has the capability of dissecting the effects of expansionary and contractionary fiscal policies related to public expenditures on environmental degradation and provides coefficient estimations for both short and long run. The results suggest that expansionary fiscal policy leads to a reduction in CO2 emissions in the long run. In contrast, it has been observed that contractionary fiscal policy does not have a significant impact on CO2 emissions in the long run. Accordingly, it has been determined that public expenditures in Turkey do not contribute positively to environmental pollution. Moreover, although an increase in income is associated with increased CO2 emissions in the long run, the validity of the Environmental Kuznets Curve hypothesis is not confirmed for Turkey. Fossil fuel consumption, as theoretically anticipated, raises CO2 emissions in both the short and long run. Thus, prioritizing the use of renewable energy sources becomes a necessity to mitigate environmental degradation. Additionally, public expenditures have no short-run impact on CO2 emissions. The study is believed to make an important contribution by addressing the gap in the literature through the application of an asymmetric approach to analyze the influence of public expenditures on environmental pollution in the context of Turkey. Furthermore, the obtained findings for Turkey are considered valuable for both researchers and governmental authorities. It is imperative to pay heed to the implementation of environmentally conscious and pollution-reducing fiscal policies. Furthermore, the promotion of renewable energy utilization should be emphasized to enhance environmental quality.

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Section: Literature Reviewmentioning

confidence: 99%