Environmental quality and sustainability: exploring the role of environmental taxes, environment-related technologies, and R&D expenditure (original) (raw)
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Environmental Economics and Policy Studies, 2023
The surge in economic and human development has led to increasing concerns about environmental degradation, thus necessitating effective strategies to enhance sustainability and environmental quality. Therefore, this study empirically examines the impact of environmental fiscal policies, environmental technologies, and research and development (R&D) expenditures on achieving environmental sustainability in the G7 countries. Using advanced econometric techniques, including the Cross-Sectionally Augmented Autoregressive Distributed Lags (CS-ARDL) model and the Dynamic Common Correlated Effects (DCCE) approach, the study identifies both short-run and long-run correlations between the aforementioned variables and their impact on greenhouse gas (GHG) emissions. Our findings confirm the inverted U-shaped Kuznets Curve relationship and reinforce previous literature on the complex dynamics between economic growth and GHG emissions specific to developed countries. The research also supports the effectiveness of well-designed environmental taxes in reducing environmental degradation and GHG emissions, consistent with and extending existing studies in this area. In addition, the study provides empirical evidence of the critical role of environmental technologies and targeted R&D expenditures in improving environmental quality. In terms of policy implications, our research underscores the urgency for policymakers in the G7 countries to fine-tune environmental taxation mechanisms and increase investment in sustainable technological solutions. Specific recommendations include the development of more efficient tax systems that adhere to the polluter-pays principle, as well as financial incentives such as tax credits and subsidies aimed at accelerating green technology adoption and innovation. In doing so, the study seeks to contribute to the broader discourse on environmental policy and sustainable development, providing valuable perspectives for both the academic community and policy actors.
PLOS ONE, 2020
This study evaluates the impacts of renewable energy, environmental taxes, environmental technology, and financial development on carbon emissions in OECD economies from 1995 to 2015 by employing system-GMM and quantile regression approaches. Our empirical analysis indicates that environmental tax negatively affects carbon emissions; economic growth impedes environmental quality by increasing carbon emissions. Further, renewable energy consumption, environmental technology, and financial development improve environmental quality by decreasing carbon emissions. We suggest that changes in policymaking to promote sustainable economic growth and environmental quality should be prevent environmental degradation, but also inspire greater investments in new technologies and energy expertise in the renewables industry.
Environmental Science and Pollution Research, 2023
In a world increasingly threatened by climate change and its associated risks, there's an urgent need to actively seek solutions for environmental protection and sustainable economic development. Central to this effort is understanding the role of environmental taxes and productive capacities in shaping environmental outcomes. Focusing on countries within the European Economic Area (EEA), this research uses advanced second-generation econometric techniques to examine this relationship. The use of cross-sectional autoregressive distributive lag (CS-ARDL) and dynamic common correlated effects (DCCE) models allows for a robust examination of panel data and provides reliable results. The results reveal an inverted U-shaped relationship, or Environmental Kuznets Curve (EKC), between GDP growth and environmental degradation in the EEA economies. Furthermore, while our data reveal a significant negative correlation between environmental taxes and CO2 emissions, we find that productive capacities have a more significant impact on reducing these emissions. These findings call for further research into the effectiveness of policies to support productive capacities in achieving environmental protection goals in the EEA.
Journal of Environmental Management, 2021
This study aims to examine the nexus between green growth and carbon neutrality targets in the context of the USA while observing the role of ecological innovation, environmental taxes, and green energy. For this purpose, data were collected from 1970 to 2015 for all the variables of interest. This research utilized the quantile autoregressive distributed lag (QARDL) method due to its various benefits, such as depicting the causality patterns based on different quantiles for different variables like green growth, ecological innovation, environmental taxes, and renewable energy. The findings through the QARDL method showed that the error correction coefficient was significant and negative with the expected negative sign for the different quantiles. The findings showed a significant and negative impact of green growth, square of green growth, ecological innovation, and environmental taxes in determining the carbon dioxide (CO 2) emissions for the USA's economy under the longrun estimation. Meanwhile, the outcome for the short-term estimation confirmed that the past and lagged values of CO 2 emission were significantly and negatively linked with the current and lagged values of CO 2 emission. On the other hand, it was found that green growth and square of green growth, ecological innovation, environmental taxes, and renewable energy played their vital role in reducing haze pollution like PM2.5. Besides, this research also covers the limitations and policy implications.
The role of government spending within the environmental Kuznets curve framework: evidence from G7 countries, 2023
This study assesses the role of government spending on environmental sustainability based on a framework that combines the environmental Kuznets curve (EKC) hypothesis with the Armey curve hypothesis. Specifically, the inverted U-shaped relationships between carbon (CO 2) emissions and economic growth (EKC hypothesis) and between government spending and economic growth (Armey curve hypothesis) are analyzed using a composite EKC model tested for cross-sectional dependence and heterogeneity, panel unit root, panel co-integration, and the augmented mean group estimation. In so doing, this study pursues a potential transmission mechanism leading from government spending to CO 2 emissions through the growth channel and presents a novel way to develop a better understanding of how economic growth policy and energy policy can be synchronized. Empirical results show that economic growth acts as a transmitter between government spending and CO 2 emissions in the USA, UK, and Canada. However, the composite EKC hypotehesis is confirmed only for the USA and Canada, where the optimal level of government spending that maximizes CO 2 emissions is 29.87% and 29.22% of GDP, respectively. In contrast, the optimal level of government spending equivalent to 28.30% of GDP minimizes CO 2 emissions in the UK. The key policy implication is that governments can achieve sustainable economic growth by setting standards for their spending levels.
Environmental Tax Reform, R&D Subsidies and CO2 Emissions: View Double Dividend Hypothesis
International Journal of Energy Economics and Policy, 2018
This study investigated whether environmental taxes achieve the double dividend of coexistence of economic growth and environmental protection. The research method used dynamic industrial relations models to estimate the influence of environmental taxes influence on the economy and environment. The goal was to conduct an objective analysis with scientific data. The conclusions provide a clue indicating that environmental taxes could only be used to facilitate short-term coexistence between economic growth and environmental protection. Once entering the mid-term and long term, the lack of innovation and technical progress would eventually cause economic development and environmental protection to diverge, which is why studies are yet to reach a consensus. The results suggest that although using environmental taxes to promote economic development and environmental protection can achieve the double dividend in the short term, in the midterm, the first dividend disappears unless a solut...
Global Business Review
The group of seven (G-7) countries are seven of the most advanced global nations. Yet, these nations have not been able to achieve environmentally sustainable economic growth (EG) in the past. Consequently, despite growing economically, the environmental quality in the G-7 countries has persistently deteriorated. Hence, the present study examined the environmental impacts associated with EG, technological innovation, institutional quality (IQ), renewable energy consumption (RENE) and population using the carbon dioxide emission figures to measure environmental quality in the G-7 economies for the period 1996–2018. The econometric analyses involved the application of different estimation techniques that control the cross-sectional dependency and slope heterogeneity issues in the data. Overall, the results indicated that greater EG and higher population size increase environmental pollution by boosting the carbon dioxide emission levels. In contrast, technological innovation, IQ impro...
Environmental Science and Pollution Research
This study examines the impact of economic policy uncertainty (EPU) and ecological innovation on carbon (CO2) emissions in a panel of 18 developed countries from 2005 to 2018 using second-generation time-series panel data techniques. We use three robust long-run estimators, namely two-stage least squares (2SLS), panel generalised method of moments (GMM) and generalised least squares (GLS), to resolve heterogeneity, endogeneity and simultaneity in the panels. We further performed causality tests to ascertain the direction of causality between the variables. Our estimations suggest three innovative findings. First, economic growth contributes significantly and positively to CO2 emissions; however, this happens at an optimal level of growth after which carbon emission reduces, indicating that our sample exhibits an inverted U-shaped environmental Kuznets curve (EKC) relationship. Second, the impact of EPU on CO2 emissions is diverse: high levels of EPU have a significant influence on C...
PLOS ONE, 2018
This study examines the Environmental Kuznets Curve hypothesis (EKC), considering the primary energy consumption among other country-specific variables, for a panel of the EU-28 countries during the period 1990-2014. By estimating pooled OLS regressions with Driscoll-Kraay standard errors in order to account for cross-sectional dependence, the results confirm the EKC hypothesis in the case of emissions of sulfur oxides and emissions of nonmethane volatile organic compounds. In addition to pooled estimations, the output of fixedeffects regressions with Driscoll-Kraay standard errors support the EKC hypothesis for greenhouse gas emissions, greenhouse gas emissions intensity of energy consumption, emissions of nitrogen oxides, emissions of non-methane volatile organic compounds and emissions of ammonia. Additionally, the empirical findings from panel vector error correction model reveal a short-run unidirectional causality from GDP per capita growth to greenhouse gas emissions, as well as a bidirectional causal link between primary energy consumption and greenhouse gas emissions. Furthermore, since there occurred no causal link between economic growth and primary energy consumption, the neo-classical view was confirmed, namely the neutrality hypothesis.
Economic growth and emissions: reconsidering the empirical basis of environmental Kuznets curves
Ecological Economics, 1998
Recent empirical research indicates that certain types of emissions follow an inverted-U or environmental Kuznets curve (EKC) as income grows. This regularity has been interpreted as a possible de-linking of economic growth and patterns of certain pollutants for developed economies. In this paper the empirical basis of this result is investigated by considering some statistical particularities of the various EKC studies performed. It is argued that the inverted-U relationship between income and emissions estimated from panel data need not hold for specific individual countries over time. Based on insights from 'intensity-of-use' analysis in resource economics, an alternative growth model is specified and estimated for three types of emissions (CO 2 , NO x and SO 2 ) in four countries (Netherlands, UK, USA and Western Germany). It is found that the time patterns of these emissions correlate positively with economic growth and that emission reductions may have been achieved as a result of structural and technological changes in the economy. 'Sustainable growth' is defined as the rate of economic growth that does not lead to growth in emissions. Its rate is calculated for each type of emission and country, based on estimated parameter values. The resulting indicators reflect a balance between the positive influence of growth and negative influence of structural change and technological progress on emission levels.