Does economic complexity matter for environmental sustainability? Using ecological footprint as an indicator

121

To mitigate environmental challenges and fulfill the Sustainable Development Goals, a broader and holistic ecological assessment is required. As a result, this research utilizes the load capacity factor, which is a distinct proxy of environmental deterioration that offers a detailed environmental evaluation measurement by comparing biocapacity and ecological footprint simultaneously. Moreover, the load capacity factor provides the combined attributes of the demand and supply-side of environmental quality. Therefore, this research scrutinized the effect of financial globalization, urbanization, economic growth, and renewable and nonrenewable energy usage on load capacity factor for the period stretching between 1970 and 2017 in Brazil. The bounds testing procedure for cointegration in combination with the critical approximation p-values of Kripfganz and Schneider (2018) disclosed a cointegrating association between load capacity and its regressors. The outcome of the ARDL method uncovered that economic growth, non-renewable and renewable energy reduce the load capacity factor, whereas urbanization has no impact on load capacity factor in Brazil. However, financial globalization has a positive effect on load capacity factor in Brazil. Finally, the study uses the spectral causality test to assess the causality interaction between the observed parameters. The policymakers should take advantage of the opportunity by developing policies that encourage the openness of the economy to foreign investors.

Section: Empirical Findingsmentioning

confidence: 93%

Section: Urbanization and Environmental Degradationmentioning

confidence: 99%

Load Capacity Factor and Financial Globalization in Brazil: The Role of Renewable Energy and Urbanization

Salem

Awosusi

et al. 2022

121

“…Third, industrial agglomeration can promote ETFP by optimizing the industrial structure. Economic structure and economic activities can have an important impact on environmental pollution and carbon emissions (Ikram et al, 2021;Sharma et al, 2021), and further affect environmental sustainability (Rafique et al, 2021). industrial agglomeration causes enterprises to obtain innovation monopoly profits, and various departments will compete to increase R and D investment to improve production efficiency and production technology level, thereby promoting the adjustment of industrial structure from the supply side.…”

Section: Mechanism Analysismentioning

confidence: 99%

Can Industrial Agglomeration Facilitate Green Development? Evidence From China

Xie

2021

Industrial agglomeration can promote economic growth through knowledge spillover and cooperation, while it may also bring serious pollution problems. Therefore, clarifying the relationship between industrial agglomeration and green development is of great significance to the realization of China’s sustainable development. In order to study the causal relationship between industrial agglomeration and green development, this paper first adopts the Overall Malquist Index method to more accurately measure the green development of Chinese cities characterized by environmental total factor productivity (ETFP). Subsequently, this paper uses the panel data of prefecture-level cities from 2003 to 2016 to study the causal relationship between industrial agglomeration and green development. We found that China’s current industrial agglomeration can promote green development. Mechanism analysis shows that industrial agglomeration can promote green development through improving the technological innovation, strengthening government intervention and optimizing the industrial structure. Finally, heterogeneity analysis shows that industrial agglomeration has a stronger role in promoting green development in areas where the economy is more developed, the degree of resource dependence is lower, and the degree of industrial agglomeration is higher. This paper not only provides theoretical and policy references for the research on industrial agglomeration and green development, but also provides experience reference for other developing countries.

“…Over the years, several studies have been done to inform the public on the influence of economic complexity, economic growth, globalization, and renewable energy consumption on CO 2 emissions; however, findings mixed. For instance, some studies (Dogan and Seker, 2016;Pata, 2021;Rafique et al, 2021) found CO 2 -ECI positive connections while some studies (Can and Gozgor, 2016;Doğan et al, 2019;Boleti et al, 2021) established negative CO 2 -ECI association. Moreover, the studies of Koengkan et al (2020), Pata (2021), and Khan et al (2019) disclosed CO 2 -GLO positive interrelation whereas the studies of He et al (2021) and Koengkan et al (2020) confirmed negative CO 2 -GLO association.…”

Section: Introductionmentioning

confidence: 99%

Modeling the Relationship Between Economic Complexity and Environmental Degradation: Evidence From Top Seven Economic Complexity Countries

Martins

Adebayo

Mata

et al. 2021

The continuous growth in CO2 emissions of nations around the globe has made achieving the aim of sustainable development extremely challenging. Therefore, the current research assesses the connection between CO2 emissions and economic complexity in the top 7 economic complexity countries while taking into account the role of economic growth, renewable energy consumption, and globalization for the period between 1993 and 2018. The research aims to answer the following questions: 1) What is the association between CO2 and the regressors in the long-run? 2) What are the effects of renewable energy consumption, economic growth, economic complexity, and globalization on CO2 emissions? The research utilized the CS-ARDL, CCEMG and panel causality approaches to investigate these interconnections. The empirical outcomes revealed that economic growth and economic complexity increase CO2 emissions while renewable energy consumption and globalization mitigate CO2 emissions. The outcomes of the causality test revealed a feedback causal connection between economic growth and CO2, while a unidirectional causality was established from economic complexity, globalization and renewable energy consumption to CO2 emissions in the top 7 economic complexity countries.