Interaction Between Environmental Kuznet Curve and Urban Environment Transition Hypotheses in Malaysia

Abstract

The aim of this paper is to examine the interconnection bewteen the environmental Kuznet curve (EKC) and urban environment transition hypotheses in the Malaysian economy. Economic growth, CO 2 emissions, energy consumption, financial development (FD), urbanization variables for the 1971-2013 period, F-bound tests, and multivariate Granger causality methods are used. The long-run relationships among the above series of variables are examined. Also, the findings confirm the existence of an inveretd EKC hypothesis in the Malaysian economy. Furthermore, the study implies that long-run urban sprawl can create environmental and health burdens in Malaysia. Moreover, the causality analysis finds bidirectional causality between CO 2 emissions and energy consumption, between economic growth and urbanization, and from economic growth to FD. The overall results suggest that a rapid urbanization process can help to reduce the level of pollution and energy consumption by employing technical innovation and ecological modernization. In addition, the increased energy efficiency, implementation of energy savings projects, energy conservation, and energy infrastructure outsourcing reduce the level of pollution produced by urban areas. Also, alternative biofuels can reduce the emission intensity and fulfill future energy needs.

Dynamic Effects of Malaysia's Government Spending on Environment Quality: Bridging Stirpat and Ekc Hypothesis

“…This result could be attributed to Grossman and Krueger (1991), where they found a non-linear relation between CO 2 emissions and economic growth, which is an inverted U-shaped relationship. Also, this result is consistent with Suki et al (2020) and Bekhet et al (2020).…”

“…Many studies investigated the relationship between GDP and environmental pollution. For example, Bekhet et al (2020), Begum et al (2015), Al-Mulali et al (2015), Ozturk and Al-Mulali (2015) investigate the trade-off between carbon dioxide emissions and GDP in the Environmental Kuznets Curve (EKC) framework. Other studies investigated the role of urbanization in determining the interaction between carbon emission and GDP (Sadorsky, 2014;Martinez-Zarzosa and Maruotti, 2011;He et al, 2017;Ozturk and Al-Mulali, 2015;Bekhet and Othman, 2017).…”

The Impacts of Rural Population Growth, Energy Use and Economic Growth on Co2 Emissions

“…Bekhet and Othman (2017) explored the linkage among urbanization, energy consumption, economic growth, and financial development and CO 2 emissions in Malaysia and found that urbanization can have a significant impact on CO 2 emissions with two different stages. Bekhet et al (2020) extended the study by reinvestigating the interaction between the environmental Kuznets curve and urban environment transition hypotheses in Malaysia. The results showed that urbanization can have a negative impact on the environment.…”

The Economic Development Impact To Environment Quality : Kuznet’s Curve Hyphothesis and Non Linier Regression Approach

“…Kuznets Curve Environmental Theory states that cases in developing countries over time, technological advances can damage natural and environmental sustainability [3]. Meanwhile, in developed countries over time technological advances can improve environmental sustainability [14]. This theory is known as the first theory to describe how the relationship between economic growth rates and environmental degradation [3].…”