The Non-Linear Impact of Medium and High-Technology Manufacturing on Environmental Quality: Evidence from Leading Technological Economies Using a PSTR Approach

Ramzi Boussaidi (), Mehdi Ben Jebli () and Hussam Buzaid M. Bakoben ()
Additional contact information
Ramzi Boussaidi: Department of Finance and Economics, College of Business, University of Jeddah, Saudi Arabia
Mehdi Ben Jebli: FSJEG Jendouba, University of Jendouba, Jendouba, Tunisia; & ESCT, QuAnLab LR24ES21, Campus University of Manouba, 2010 Manouba, Tunisia
Hussam Buzaid M. Bakoben: Department of Finance and Economics, College of Business, University of Jeddah, Saudi Arabia

International Journal of Energy Economics and Policy, 2025, vol. 15, issue 2, 510-520

Abstract: High-tech manufacturing presents a dual challenge: while it offers opportunities to enhance environmental quality through innovation and efficiency, it can also exacerbate environmental risks if not properly managed. This study explores the non-linear relationship between medium and high-technology manufacturing (MHTM) and CO2 emissions, utilizing data from 12 leading MHTM countries over the period 1990-2021. Employing the Panel Smooth Transition Regression (PSTR) model of Gonza?lez et al. (2005), the analysis uncovers a threshold effect in the MHTM-CO2 emissions nexus. Specifically, an MHTM threshold of 56.68% is identified: below this level, MHTM significantly increases CO2 emissions, whereas, above it, MHTM significantly reduces emissions, thereby enhancing environmental quality. The findings also reveal a threshold-dependent effect of renewable energy (RE); below the threshold, RE increases CO2 emissions, while above it, RE significantly improves environmental quality. Conversely, non-renewable energy (NRE) and trade consistently contribute to environmental degradation, regardless of the threshold. Sensitivity analyses, based on European and non-European sub-samples, show that for European countries, MHTM reduces emissions both below and above a threshold of 58.49%. For non-European countries, however, significant reductions in CO2 emissions occur only when MHTM exceeds a threshold of 66.7%. These results provide critical insights into the nuanced role of technology, energy, and trade in shaping environmental outcomes.

Keywords: Environmental Quality; Technology Manufacturing; Renewable Energy; Non-Renewable Energy; PSTR (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://econjournals.com/index.php/ijeep/article/download/18419/8681 (application/pdf)

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:eco:journ2:v:15:y:2025:i:2:id:18419

Ordering information: This journal article can be ordered from
https://econjournals.com/index.php/ijeep

DOI: 10.32479/ijeep.18419

Access Statistics for this article

More articles in International Journal of Energy Economics and Policy from International Journal of Energy Economics and Policy
Bibliographic data for series maintained by Monica Sinhat ().