Environmental implications of regional financial development on air pollution: evidence from European countries

Mohsen Khezri (), Mohammad Sharif Karimi (), Yousaf Ali Khan () and Mehdi Khodaei ()
Additional contact information
Mohsen Khezri: University of Kurdistan Hewler (UKH)
Mohammad Sharif Karimi: Monash University
Yousaf Ali Khan: Hazara University
Mehdi Khodaei: Tarbiat Modares University

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, 2023, vol. 25, issue 6, No 5, 4889-4909

Abstract: Abstract This study focused on the spatial effects of CO2 determinants, using data from 43 European countries between 1996 and 2018. Tests proved the existence of the spatial Durbin model. The findings indicate that the logarithm of GDP per capita, urbanization, and energy use have enhancing effects on CO2 emissions, but that these effects are meaningless for trade openness. Most of the coefficients provided insignificant results, while six financial development indicators were entered into the model in a straight line. The addition of the term "interaction between energy intensity and financial development" improved the effects of all of the components significantly. The phrase's negative and significant coefficient predicts increased energy intensity efficiency as a result of the development of multiple financial production components. The analysis of spatial effects reveals that control variables in adjacent countries have negligible effects on CO2 emissions. Overall, the findings show that CO2 emissions are falling as neighboring countries' productivity and financial development rise. The findings indicate that financial development in neighboring countries has comparable effects on CO2 emissions as domestic financial development. As a result of these findings, European countries have reached a point of financial integration.

Keywords: Financial development; CO2 emissions; Urbanization; European countries; Spatial Durbin model (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://link.springer.com/10.1007/s10668-022-02249-y Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:endesu:v:25:y:2023:i:6:d:10.1007_s10668-022-02249-y

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/10668

DOI: 10.1007/s10668-022-02249-y

Access Statistics for this article

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development is currently edited by Luc Hens

More articles in Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().