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The Effect of Energy Consumption and Economic Growth on Environmental Sustainability in the GCC Countries: Does Financial Development Matter?
| Content Provider | MDPI |
|---|---|
| Author | Baydoun, Hala Aga, Mehmet |
| Copyright Year | 2021 |
| Description | Achieving environmental sustainability whilst minimizing the climate change effect has become a global endeavor. Hence, this study examined the effect of energy consumption, economic growth, financial development, and globalization on $CO_{2}$ emissions in the Gulf Cooperation Council (GCC) countries. The research utilized a dataset stretching from 1995 to 2018. In a bid to investigate these associations, the study applied cross-sectional dependence (CSD), slope heterogeneity (SH), Pesaran unit root, Westerlund cointegration, cross-sectionally augmented autoregressive distributed lag (CS-ARDL), and Dumitrescu and Hurlin (DH) causality approaches. The outcomes of the CSD and SH tests indicated that using the first-generation techniques produces misleading results. The panel unit root analysis unveiled that the series are I (1). Furthermore, the outcomes of the cointegration test revealed a long-run association between $CO_{2}$ emissions and the regressors, suggesting evidence of cointegration. The findings of the CS-ARDL showed that economic growth and energy consumption decrease environmental sustainability, while globalization improves it. The study also validated the environmental Kuznets curve (EKC) hypothesis for GCC economies. In addition, the results of the DH causality test demonstrated a feedback causality association between economic growth and $CO_{2}$ emissions and between financial development and $CO_{2}$ emissions. Moreover, there is a one-way causality from energy consumption and globalization to $CO_{2}$ emissions in GCC economies. According to the findings, environmental pollution in GCC countries is output-driven, which means that it is determined by the amount of energy generated and consumed. |
| Starting Page | 5897 |
| e-ISSN | 19961073 |
| DOI | 10.3390/en14185897 |
| Journal | Energies |
| Issue Number | 18 |
| Volume Number | 14 |
| Language | English |
| Publisher | MDPI |
| Publisher Date | 2021-09-17 |
| Access Restriction | Open |
| Subject Keyword | Energies Co2 Emissions Economic Growth Energy Consumption Environmental Sustainability Financial Development Globalization |
| Content Type | Text |
| Resource Type | Article |
