The Nexus between Environmental Quality, Economic Growth, and Trade Openness in Saudi Arabia (1990-2017)

Saida Daly and Mohamed Abdouli
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Saida Daly: Department of Economics and Finance, College of Business and Economics, Qassim University, P.O. Box 6640, Buraidah 51452, Qassim, Saudi Arabia; & Department of Economics, Faculty of Economic Sciences and Management of Mahdia, University of Monastir, Monastir 5000, Tunisia,
Mohamed Abdouli: Development Economics Laboratory, Faculty of Economics and Management of Sfax, Tunisia; & Doctoral School in Economics and Management, Faculty of Economics and Management of Sousse, Tunisia.

International Journal of Energy Economics and Policy, 2023, vol. 13, issue 4, 579-598

Abstract: In fact, this study endeavors to explore the relationship between CO2 emissions, trade, and economic growth using the simultaneous equation for Saudi Arabia over the period 1990 2017, using the VAR model and the impulse response functions to examine the relationship between these variables. Therefore, the obtained results showed that there is evidence of a bidirectional causality between CO2 emissions and economic growth. Moreover, the feedback hypothesis between trade openness and CO2 emissions is validated. Then, the retroaction hypothesis between economic growth and trade openness is identified. Furthermore, our results indicate economic growth impede environmental quality, while our empirical results have established crucial relationships that have important policy implications. However, it is mandatory for policy makers to develop economic, environmental and outside policies to promote economic growth and trade and improve the environmental quality.

Keywords: Economic growth; CO2 emissions; Trade openness; VAR model; Saudi Arabia (search for similar items in EconPapers)
JEL-codes: B41 F31 F43 I25 O47 P28 P33 Q56 R11 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (4)

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