Does trade openness mitigate the environmental degradation in South Africa?

Impact of economic policy uncertainty and renewable energy on environmental quality: testing the LCC hypothesis for fast growing economies

This study investigates the influence of economic policy uncertainty and trade openness on load capacity factor for fast growing countries for time period of 1996-2019. The empirical outcomes verify the presence of the LCC hypothesis in fast growing economies. Results also show that economic policy uncertainty reduces environmental quality for lower quantiles, whereas renewable energy consumption is a useful tool for improving environmental quality. Moreover, the negative sign of the coefficient of trade openness demonstrates that the current pattern of trade is not providing the desired outcomes. Based on these empirical findings, we suggest a comprehensive policy framework to attain the targets of SDG 07 (renewable energy), SDG 08 (economic growth), and SDG 13 (climate action).

Trade openness, human capital, natural resource, and carbon emission nexus: a CS-ARDL assessment for Central Asian economies

There is a call for global efforts to preserve the ecological systems that can sustain economies and people's lives. However, carbon emission (CEM) threatens the sustainability of humanity and ecological systems. This analysis looked into the influence of energy use (ERU), human capital (HCI), trade openness (TOP), natural resource (NRR), population, and economic growth (ENG) on CEM. The paper gathered panel data from the Central Asia region from 1990 to 2020. The CS-ARDL was applied to establish the long-term interaction among the indicators. The paper's findings indicated the presence of the environmental Kuznets curve (EKC) in the Central Asia regions. Also, the empirical evidence highlighted that energy use, natural resources, and trade openness cause higher levels of CEM. However, the research verified that CEM can be improved through human capital and urban population growth. The study also found that HCI moderates the interaction between NRR and CEM. The causality assessment indicated a one-way interplay between ENG, ERU, NRR, and CEM. The study proposes that to support ecological stability in these regions, policy-makers should concentrate on developing human capital, investing in renewable energy sources, and utilizing contemporary technologies to harness natural resources in the economies of Central Asia.

Renewable energy, inequality and environmental degradation

The connection between income inequality and environmental degradation remains a topic of persistent debate, marked by inconsistencies in both theoretical and empirical studies. This study offers a novel contribution to this discourse by investigating the simultaneous influences of renewable energy and income inequality on environmental degradation. Utilizing data from 158 nations from 2000 to 2017, our research reveals a crucial moderating role of renewable energy in the nexus between income inequality and environmental degradation. The study's key finding is that the impact of income inequality on environmental degradation is contingent on the level of renewable energy development. In scenarios with limited renewable energy, income equality leads to increased environmental degradation. However, when renewable energy is more developed, income equality contributes to reducing environmental degradation. This novel insight suggests that renewable energy development can mitigate the trade-off between pursuing income equality and environmental sustainability, thereby enabling their simultaneous achievement. The research also highlights that a more equitable income distribution enhances the environmental benefits of renewable energy. Further analysis demonstrates the significant role played by household consumption behavior and social norms in shaping this phenomenon. By adding these new dimensions to the existing literature, the study significantly enriches the understanding of the complex interplay among economic factors, renewable energy, and environmental sustainability.

Battling for net zero carbon: the position of governance and financial indicators

Africa, over the past years, has put various measures in place in the fight against carbon emissions. Achieving net zero carbon has caused the continent researchers to investigate various conditions required for a successful transition. Therefore, the political system cannot be left out since it plays a major role in decision-making. This study contributes to previous literature analyzing the empirical effect of financial development and governance quality on carbon emissions. The study is focused on 52 African countries with data from 1996 to 2021. Panel quantile and generalized method of moments are used for the analysis. The result indicates that financial development contributes to environmental degradation, government effectiveness, rule of law, and political stability which promote environmental pollution; however, control of corruption, renewable energy, and economic growth promote ecological sustainability. According to the aforementioned, it is crucial for governments to include financial development plans in national environmental strategies, particularly for those in African nations. Furthermore, governments should put restrictions on trade to control the trade of high-carbon technologies.

Carbon emissions and the rising effect of trade openness and foreign direct investment: Evidence from a threshold regression model

The relationship between carbon emissions, foreign trade openness, and FDI has been studied in prior studies. The previous studies, however, did not examine the link by focusing on carbon emissions in India's industrial sectors. Using carbon emission intensity as a threshold variable and a threshold regression model, we add to the existing studies by assessing the influence of India's industrial sector on carbon emissions. According to the study's findings, there are three threshold effects of foreign direct investment and foreign trade openness on industrial carbon emissions. FDI harms industrial carbon emissions, as it has a characteristically declining and then rising effect coefficient on industrial carbon emissions. Foreign trade openness, however, affects carbon emissions both positively and negatively. Foreign trade openness encourages carbon emission in sectors of the economy with lower carbon emission intensity. However, it also partially constrains it for sectors with high carbon emission intensity. The number of employees, technological innovation, GDP per capita, and economic activity intensity significantly influence carbon emissions in India's industrial sector. This study can extend further in other countries using the recent innovative methodologies.

Towards environmental degradation mitigation: The role of regulatory quality, technological innovation and government effectiveness in the CEMAC countries

The study explores the interaction between regulatory quality, economic growth, technological innovation, energy consumption, government spending on research and development, and environmental degradation (EVD) in the Economic and Monetary Community of Central Africa (CEMAC) region. The study applied the econometric approach CS-ARDL to estimate the short and long-term interaction between the regressors and the explanatory variable. The study period covers from 1990 to 2020. To summarize the findings of this research, (1) the study discovered a positive relationship between energy consumption, government effectiveness, regulatory quality, and environmental degradation. (2) Economic growth, government spending on research and development, and technological innovation, on the other hand, extensively dissipates EVD in the CEMAC economies. (3) The causality analysis espoused a bidirectional connection between energy consumption, technological innovation, and EVD. (4) Lastly, a unidirectional interplay exists between economic growth, government effectiveness, regulatory quality, and EVD. This study also serves as a reference point for policymakers and governmental institutions to invest in cleaner technologies and increase government research and development spending to mitigate environmental degradation in these areas.

Can fiscal decentralization be the route to the race to zero emissions in South Africa? Fresh policy insights from novel dynamic autoregressive distributed lag simulations approach

There has been a plethora of debate on the link between fiscal decentralization and a drop in carbon dioxide (CO2) emissions, even though the evidence supporting this assertion is relatively sparse. Although the precise nature of this relationship is still up for discussion, economic hypothesis postulates that fiscal decentralization has an impact on environmental sustainability. Some researchers claim that fiscal decentralization could potentially result in a race to the top, while some believe it would lead to a race to the bottom. This analysis intends to shed light on the precise processes by which this connection may work in South Africa between 1960 and 2020 in light of current discussions in environmental and development economics. In contrary to previous studies, this paper employs a cutting-edge dynamic autoregressive distributed lag simulations methodology to evaluate the positive and negative variations in fiscal decentralization on CO2 emissions. Our findings demonstrate the prevalence of the race to the top strategy by illustrating how fiscal decentralization has a bearing on CO2 emissions reduction in the short and long terms. In accordance with the findings, greater fiscal decentralization should be implemented through the transfer of more powers to regional authorities, especially in the realm of environmental legislation considerations, in a bid to preserve South Africa's environmental integrity. By establishing a lower tier of government and defining roles at the federal and provincial divisions, South Africa could adopt strategies to improve green environment in an effort to fulfill the energy-saving tasks of fiscal expenditures.

Revisiting the nexus between fiscal decentralization and CO2 emissions in South Africa: fresh policy insights

The argument over fiscal decentralization and carbon dioxide emission (CO₂) reduction has received much attention. However, evidence to back this claim is limited. Economic theory predicts that fiscal decentralization affects environmental quality, but the specifics of this relationship are still up for debate. Some scholars noted that fiscal decentralization might lead to a race to the top, whereas others contended that it would result in a race to the bottom. In light of the current debates in environmental and development economics, this study aims to provide insight into how this relationship may function in South Africa from 1960 to 2020. In contrast to the existing research, the present study uses a novel dynamic autoregressive distributed lag simulation approach to assess the positive and negative changes in fiscal decentralization, scale effect, technique effect, technological innovation, foreign direct investment, energy consumption, industrial growth, and trade openness on CO₂ emissions. The following are the main findings: (i) Fiscal decentralization had a CO₂ emission reduction impact in the short and long run, highlighting the presence of the race to the top approach. (ii) Economic growth (as represented by the scale effect) eroded ecological integrity. However, its square (as expressed by technique effect) aided in strengthening ecological protection, validating the environmental Kuznets curve hypothesis. (iii) CO₂ emissions were driven by energy utilization, trade openness, industrial value-added, and foreign direct investment, whereas technological innovation boosted ecological integrity. Findings suggest that further fiscal decentralization should be undertaken through further devolution of power to local entities, particularly regarding environmental policy issues, to maintain South Africa's ecological sustainability. South Africa should also establish policies to improve environmental sustainability by strengthening a lower layer of government and clarifying responsibilities at the national and local levels to fulfill the energy-saving functions of fiscal expenditures.

Sustainable development of West African economies to achieve environmental quality

The deterioration of environmental quality spurred on by rising greenhouse gas (GHG) emissions is the main threat to reducing carbon footprint. Africa has recently been identified as having experienced excessive temperatures above pre-industrial standards. Despite its lower GHG emissions, Africa continues to be among the most impacted areas of the world by global warming. However, this research scrutinizes the effect of human capital and trade openness on the ecological footprint (ECF) and carbon dioxide (CO₂) emissions using data from West Africa from 1995 to 2016. The research used dynamic ordinary least squares, fully modified ordinary least squares, and paired Dumitrescu-Hurlin panel causality tests for its assessment. The study's findings are as follows: (1) The study found that human capital and trade openness decrease the ecological footprint in West Africa; (2) globalization reduces CO₂ emissions while also increasing the ecological footprint; (3) the analysis reveals that natural resources and the population improve environmental quality in West Africa, while biocapacity reduces the ecological footprint and improves CO₂ emissions in the region; and (4) the study revealed the bidirectional causality between biocapacity, the population, and ECF. The study also revealed the bidirectional causality between biocapacity, population, human capital, natural resources, and CO₂ emissions, while ecological footprint is unidirectionally causally related to globalization, human capital, and trade capital. Unidirectional causality runs from the ecological footprint, globalization, and trade openness to CO₂ emissions. To ensure their countries have a long-term future, policymakers in West Africa should take action to limit overexploitation of natural resources and encourage people to live more sustainably. The study suggested that West African countries adopt "green growth" policies and improve technology to help their economies and the environment.

CO2 emissions-energy consumption-militarisation-growth nexus in South Africa: evidence from novel dynamic ARDL simulations

This study draws ardent attention to the Sustainable Development Goal 13 (climate change mitigation) of the United Nations by investigating the CO₂ emissions-energy consumption-militarisation-economic growth nexus for South Africa (SA) from 1960 to 2019. The researcher applied frequency domain causality and the novel dynamic autoregressive distributed lag (ARDL) simulation approaches to achieve the research objective. The main findings reflected that (i) there is a long-run equilibrium relationship between the variables; (ii) there is no causality between militarisation and energy consumption; (iii) unidirectional causality runs from militarisation to economic growth; (iv) there is no causality between militarisation and CO₂ emissions; and (v) unidirectional causality runs from energy consumption to economic growth. The dynamic ARDL simulations' main results suggest that (i) in the short-run, a positive and insignificant relationship exist between militarisation and CO₂ emissions. Conversely, a negative and significant relationship was recorded in the long-run. Thus, the treadmill theory of destruction is not valid for SA. (ii) In the short-run, economic growth has a positive and significant impact on CO₂ emissions, while in the long-run, economic growth has a negative and significant impact on CO₂ emissions. This implies the environmental Kuznets curve (EKC) hypothesis holds for SA. Overall, this research suggests a synergy between defence, energy, growth, and environmental policies in the short- and long-run to promote and maintain environmental quality in SA.

Decomposing the effect of trade on environment: a case study of Pakistan

Using time-series data from 1984 to 2019, the study examines the vigorous trade-environment relation in Pakistan. Pakistan is an interesting case study in which trade liberalization has expanded economic activity while also increasing environmental pollution during the last two decades. As a result, determining whether trade and industrial operations have contributed to environmental degradation is crucial. Our first goal is to look at how trade affects the environment in terms of scale, composition, and technique. The second step is to look into the pollution haven theory. The study uses a new approach to measuring trade openness called composite trade intensity, which differs from the traditional approach. The dynamic autoregressive distributed lag (ARDL) simulation framework, which was recently developed, was employed. The findings show that the scale impact raises CO₂ emissions while the technique effect helps to lessen them, proving the existence of an environmental Kuznets curve (EKC) hypothesis. The composition impact contributes to increased pollution in the environment. Through the expansion of pollution-intensive export businesses, trade openness degrades environmental quality over the long as well as in the short term. The notion of a pollution hypothesis has also been proven. The quality of the environment deteriorates as a result of urbanization, whereas it improves as a result of good governance. Economic growth, trade openness, urbanization, and CO2 emissions have bidirectional causality, according to frequency domain causality findings. Based on our empirical findings, the study concludes that individual efforts, as well as collective efforts at the international level to reduce carbon emissions, are critical to solving the problem of environmental degradation and making the world a completely peaceful place.

Investigating the moderating role of economic policy uncertainty in environmental Kuznets curve for South Africa: Evidence from the novel dynamic ARDL simulations approach

South Africa, one of the emerging markets and fast-developing economies in Sub-Saharan Africa recognised for varying world's natural assets on the international market, has recorded significant economic growth in the previous several years. However, aside from the ecological repercussions of energy generation, how economic uncertainties moderate the effects of energy intensity, renewable and non-renewable energy usage, and economic complexity on the environment has largely gone unnoticed. As a result, this paper addresses an important empirical vacuum by exploring the moderating influence of economic policy uncertainty in the environmental Kuznets curve for South Africa from 1960 to 2020. Results from the novel dynamic autoregressive distributed lag simulations framework reveal the following key findings: (i) economic policy uncertainty accelerates environmental degradation in both the short and long run; (ii) economic growth (as measured by the scale effect) increases environmental degradation, whereas the square of economic growth (as measured by the technique effect) slows it down, confirming the presence of the environmental Kuznets curve (EKC) hypothesis; (iii) environmental quality is deteriorated by energy intensity, economic complexity, non-renewable energy usage, and trade openness; (iv) the use of renewable energy and technological innovation increase environmental quality; (v) whereas the moderating effects of economic policy uncertainty on the environmental impacts of energy intensity, renewable and non-renewable energy consumption result in an increase in environmental destruction, its moderating effect on environmental implication of economic complexity plays an important role in improving environmental quality. These findings permit us to draw important policy recommendations for South Africa for improving environmental quality.