The Effect of External Debt on Emissions: Evidence From China

Beşe, Emrah; Friday, H. Swint; Özden, Cihan

doi:10.32479/ijeep.10605

Cited by 25 publications

(15 citation statements)

References 29 publications

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“…The findings showed that there is important linkage among CO 2 emissions, energy, real income and external debt in Turkey. [ 39 ] employed the ARDL technique to explore the effect of public debt on the level of CO2 emissions in China over the tested period from 1978 to 2014. The findings showed a positive and significant influence of external debt on the level of environmental pollution in China.…”

Section: Review Of Literaturementioning

confidence: 99%

Financial sector development, external debt, and Turkey’s renewable energy consumption

2022

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The primary aim of this paper is to provide fresh evidence by testing the linkage between renewable energy consumption, financial development, and external debts in Turkey, using the Bootstrap ARDL test (McNown et al. 2018). The Bootstrap ARDL test is desired over traditional co-integration tests due to its ability to predict when resolving power and size limitation issues, and its corresponding features, which have not been addressed by traditional co-integration tests. The ARDL testing model is employed to investigate the coefficients amongst the selected variables. The findings from the ARDL test illustrate that there is a positive linkage between renewable consumption and Turkey’s financial development. Furthermore, the outcomes illustrate that the coefficient of external debt is negative and significant. The results indicate that policymakers in Turkey must use the growth of the financial sector to minimize environmental degradation by promoting investment in energy and production through renewable energy sources. Furthermore, the research suggested that Turkey’s policy-makers should reformulate the external debt policy to reduce the negative influence of external debt on sustainable energy development. This could potentially be achieved by removing any restrictions on international capital flow or barriers on foreign capital and foreign investment. Hence, the findings of this paper provide valuable conclusions and recommendations for Turkey heading to sustainable and green financial sector.

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Section: Review Of Literaturementioning

confidence: 99%

Financial sector development, external debt, and Turkey’s renewable energy consumption

2022

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“…By using a vector error correction model, Katircioglu and Celebi (2018) do not find any evidence for the effect of ED on CO2 emissions in Turkey during the 1960-2013 period. In the case of China, Beşe et al (2021b) use ARDL and nonlinear ARDL models and find a significant positive effect of ED on CO2 emissions for the 1978-2014 period. By using the same methodologies, Beşe et al (2021a) analyze the effect of external debt on different types of emissions in India between 1971 and 2012.…”

Section: Literature Reviewmentioning

confidence: 99%

The Effect of External Debt on Greenhouse Gas Emissions

Carrera¹,

Vega²

2022

Preprint

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We estimate the causal effect of external debt (ED) on greenhouse gas (GHG) emissions in a panel of 78 emerging market and developing economies (EMDEs) over the 1990-2015 period. Unlike previous literature, we use external instruments to address the potential endogeneity in the relationship between ED and GHG emissions. Specifically, we use international liquidity shocks as instrumental variables for ED. We find that dealing with the potential endogeneity problem brings about a positive and statistically significant effect of ED on GHG emissions: a 1 percentage point (pp.) rise in ED causes, on average, a 0.7% increase in GHG emissions. Moreover, when disaggregating ED between public and private indebtedness, instrumental variable estimates allow us to find a positive and statistically significant effect of external public debt on GHG emissions. Finally, disaggregation by type of creditor reveals that the external public debt from bilateral (private) creditors causes, on average, a 1.8% (1.2%) increase in GHG emissions. On the contrary, the instrument used is not relevant in the case of multilateral lending so we have not found any significant effect of external public debt from IMF creditors or other multilateral creditors on environmental damage.

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“…Then, the (CREDIT) effects on the human development are also analyzed by many empirical studies, such as that of [74,99,[107][108][109] among others, and included the external debt variable in their empirical models to examine their impacts on economic growth. In addition, as for ( [110], they used this variable in their model to study its effect on the carbon dioxide emissions (CO 2 ) in the case of China, whereas [111] included the external debt variable in his empirical study in order to analyze its impact on human development.…”

Section: Presentation Of the Modelmentioning

confidence: 99%

Financing Sustainable Development, Which Factors Can Interfere?: Empirical Evidence from Developing Countries

2022

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The role of sustainable development financing resources in achieving sustainable development goals is one of the most important topics talked about in the recent sustainable development conflict, especially in the developing countries. Using the Autoregressive Distributed Lag (ARDL) model over the period 2002–2018, this study attempts to better identify sustainable development financing resources and examine their role in simultaneously ensuring economic growth and achieving social and environmental objectives in 24 developing countries. We found that increases in official development assistance, public debt, and remittances impede economic growth and human development and increase environmental pollution. Thus, they inhibit sustainable development. However, our findings demonstrated that foreign direct investment and international trade, which enhance economic growth, do not have any effect on CO2 emissions, while foreign direct investment inflows boost human development and international trade seems detrimental to it. Our study also show the effectiveness of CREDIT in achieving sustainability goals by reducing environmental degradation and improving economic growth and human development. Moreover, these empirical results may draw the attention of policymakers as they help them build rigorous economic policies to sustain economic development.

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The Effect of External Debt on Emissions: Evidence From China

Cited by 25 publications

References 29 publications

Financial sector development, external debt, and Turkey’s renewable energy consumption

Financial sector development, external debt, and Turkey’s renewable energy consumption

The Effect of External Debt on Greenhouse Gas Emissions

Financing Sustainable Development, Which Factors Can Interfere?: Empirical Evidence from Developing Countries

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