Is agricultural development good for carbon mitigation in India? Evidence from the asymmetric NARDL model

Zafar, Shadman; Rasool, Haroon; Tarique, Md.

doi:10.1108/meq-03-2022-0064

Cited by 10 publications

(7 citation statements)

References 49 publications

(74 reference statements)

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“…The existent studies have identified many social and economic factors like financial development, national income, trade, foreign direct investment (FDI), financial development, industrialization, energy consumption, and so on, as main determinants of environmental quality (Boutabba, 2014;Dar and Asif, 2018;Imamoglu, 2018;Danish et al, 2019a,b;Rasool et al, 2020;Chowdhury et al, 2021;Uzar, 2021;Zafar et al, 2023).The present study investigates the direct and the moderating role of institutional quality in the financial development and EFP nexus in the context of India.…”

Section: Financial Development Institutions Ecologymentioning

confidence: 87%

“…In terms of GDP measured in purchasing power parity ($11.33tn), the South Asia giant ranks third. India is the thirdlargest aggregate emitter of carbon dioxide accounting for 5.9% of total global emissions in 2010 after China and the United States (Zafar et al, 2023). India is also fourth-largest GHG emitter in the world.…”

Section: Introductionmentioning

confidence: 99%

“…On the other hand, as the country's growing population becomes more affluent, to meet rising energy demands it continues to build more coal plants and import more crude oil.). It is also the fourth-largest energy user in the world (Zafar et al, 2023). A large and a dominant portion of this energy consumption is met by using fossil fuels.…”

Section: Introductionmentioning

confidence: 99%

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Do financial development and institutional quality matter for ecological sustainability in the long run? Evidence from India

Khanday

Wani

Tarique

2023

MEQ

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PurposeThe paper assesses the moderating function of institutions in the financial development and environmental nexus covering India for the time period 1980–2019.Design/methodology/approachDeviating from extant literature which has mostly used emissions of major greenhouse gasses as a measure of environmental quality, the present study uses a broad measure of environmental quality called ecological footprint (EFP). Financial development is measured using a robust proxy recently introduced by International Monetary Fund (IMF). This index is multifaceted and covers three broad dimensions of financial sector in terms of depth, efficiency and access of both financial institutions and markets, thus outperforming the exclusively bank-based measures used in the past literature. Further institutional quality index is generated using the data from international country risk guide. Finally, autoregressive distributed lag model is used for the empirical estimation of short-run and long-run results.FindingsThe empirical estimates reveal that financial development and institutional quality are good for long-run environmental sustainability of India, whereas economic growth degrades the environment in the long- run. The results also attest to the existence of pollution heaven hypothesis in India for long run. Furthermore, regarding the moderating role of institutions, the study reveals that institutional quality complements financial development in affecting environment in the short run. While as, in the long run, they play a substitutive role whereby sound institutions cover-up the inefficiencies in financial system.Research limitations/implicationsFirst, the paper uses the index of financial development developed by the IMF in order to quantify the level of financial development in India overtime. The index is based on three key dimensions of financial development such as the depth, efficiency and access of both financial institutions and markets. However, the index completely neglects the role of financial stability in determining financial development. Thus, future studies that are based on this IMF introduced index of financial development should incorporate the stability dimension to it. Second, this empirical study focused exclusively on India and employed aggregate EFP to measure environmental quality. Further studies can complement the content of this research by conducting similar studies to capture country-specific characteristics of other emerging economies and also scrutinize the impact on the six sub-indices of EFP.Practical implicationsThe results of the study reveal that the effect of financial development, and institutions on ecological footprint is sensitive to time dynamics. Moreover, the findings offer important policy implications to government and policy makers in India on how to curb the menace of environmental degradation.Originality/valueThe paper addresses the gap in the literature by examining the moderating role of institutional quality in the financial development and ecological footprint nexus in India. Furthermore, the authors employ a robust proxy for both financial development and environmental quality unlike extant studies on India.

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Section: Financial Development Institutions Ecologymentioning

confidence: 87%

Section: Introductionmentioning

confidence: 99%

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Do financial development and institutional quality matter for ecological sustainability in the long run? Evidence from India

Khanday

Wani

Tarique

2023

MEQ

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“…Different studies attempt to investigate the dynamic relationships of different variables and their effect on environmental quality. For instance, environmental taxes (Shahzad, 2020), natural resources management (Hussain et al, 2017), green innovation (Jiakui et al, 2023), food security (Zafar et al, 2022), environmental audit (Baalouch et al, 2019). Most of the variables concerning such research studies are trade, tourism, CO 2 emission, GDP, energy consumption, FDI and FD.…”

Section: Literature Reviewmentioning

confidence: 99%

Exploring the N‐shaped EKC in the top tourist destinations. Empirical evidence from cross‐country analysis

et al. 2023

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Tourism, energy consumption, economic growth, and financial development (FD) have serious consequences on environmental quality, which have gained attention of researchers. This research study attempts to highlight the impact of these variables on carbon dioxide (CO2) emissions in the Asian top‐four tourism countries, namely, Thailand, Singapore, Malaysia and Hong Kong. To achieve these objectives, the study applied Fully Modified Ordinary Least Squares (FMOLS) econometric technique to estimate the long‐run relationship, using annual data. Moreover, the study also applied the Dumitrescu–Hurlin panel causality test to identify the direction of the causality. The findings of the study show that energy consumption and trade openness have a negative impact on CO2 emissions. Moreover, tourism and FDI affect carbon emissions positively. Moreover, the study also validated the N‐shaped environmental Kuznets curve in these countries, indicating that economic growth positively influences carbon emissions in the early stages. However, in the middle stage, economic growth positively affects CO2 emissions, while in the later stage, it affects positively. Further, a unidirectional causality has been found from trade, economic growth and tourist arrivals to FD. Furthermore, based on empirical findings, the study suggests various policy implications for the government of the top‐four Asian tourist countries.

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“…Given this scenario, scientific community at large makes serious attempt to address the sustainability concern of the planet and trying to figure out the factors critical in mitigating the environmental problems. In this setting, several elements have been found in the economics literature explaining the economic drivers of environmental deterioration such as energy consumption, industrialization, agricultural development, transportation, urbanization, trade openness, financial development, foreign direct investment, population expansion and so on (Dar and Asif, 2018;Zafar et al, 2022;Itoo and Ali, 2023). Interestingly, studies that predicted environmental deterioration have been extensively studied using various econometric approaches and analysing different nations throughout in a different time-period.…”

Section: Introductionmentioning

confidence: 99%

Dynamic linkages among energy consumption, urbanization and ecological footprint: empirical evidence from NARDL approach

Khan

Zafar

2023

MEQ

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PurposeThe primary purpose is to investigate the dynamic relationships among urbanization, energy use and environmental pollution in the context of India from 1971 to 2018. The paper also examines the validity of Environmental Kuznets Curve (EKC) hypothesis in the present Indian context.Design/methodology/approachThe study uses a nonlinear autoregressive distributed lag cointegration test (Shin et al., 2014) to investigate the dynamic relationship among the mentioned variables. The Wald test is also used to statistically check the presence of asymmetry. Additionally, the VECM test is applied to examine the causality among the variables.FindingsThis study documents that urbanization in India is good for environment in the long run, whereas energy consumption is bad for the environment. It also finds that positive and negative shocks of energy and urbanization exert asymmetric impacts on ecological footprint. Furthermore, the results could not validate the EKC hypothesis for India.Practical implicationsThe outcome of the study suggests designing an environmental policy which considers the nonlinearity of the investigated relationships and bearing in mind the use of comprehensive indicator like ecological footprint is equally important to address the wide-ranging problem of the environment. Policy reorientation towards the production and consumption of green energy, investment in research and development, and use of efficient technology is very crucial to achieve sustainable outcomes in the long run.Originality/valueIn this study, the researchers use the ‘ecological footprint’ variable to obtain a more accurate and comprehensive assessment of environmental deterioration. The mentioned dynamic relationships are investigated using an improved methodology of the NARDL model, which assumes the asymmetric impact of the explanatory variables on the response variable. The novelty of this study lies in examining the non-linear impact of urbanization and energy on ecological footprint which is inadequately addressed in the context of Indian economy.

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Is agricultural development good for carbon mitigation in India? Evidence from the asymmetric NARDL model

Cited by 10 publications

References 49 publications

Do financial development and institutional quality matter for ecological sustainability in the long run? Evidence from India

Do financial development and institutional quality matter for ecological sustainability in the long run? Evidence from India

Exploring the N‐shaped EKC in the top tourist destinations. Empirical evidence from cross‐country analysis

Dynamic linkages among energy consumption, urbanization and ecological footprint: empirical evidence from NARDL approach

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