An analysis of the environmental consequences of natural resources and economic openness: the moderation role of institutional quality

Junaid Ashraf (), Aiman Javed () and Muhammad Asif Khan ()
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Junaid Ashraf: Nanchang Institute of Technology
Aiman Javed: University of Science and Technology of China
Muhammad Asif Khan: Wuhan University

Economic Change and Restructuring, 2025, vol. 58, issue 3, No 9, 24 pages

Abstract: Abstract Natural resources play a vital role in economic and social development, but irresponsible usage leads to environmental degradation and resource depletion. This study examines the impact of environmental degradation on institutional quality, natural resources, and economic openness in Belt and Road countries from 1990 to 2021. It introduces novel interaction terms between institutional quality and both natural resources and economic openness. Using the System-Generalized Method of Moments to address endogeneity and unobserved heterogeneity, results show that while natural resources and economic openness increase CO₂ emissions, their interaction with institutional quality improves environmental quality. The study recommends boosting research and development for green technologies, promoting clean industrial practices, and tailoring policies to institutional quality levels for better environmental outcomes.

Keywords: $${\text{CO}}_{2}$$ CO 2 Emissions; Economic openness; Natural resources; Institutional quality (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s10644-025-09887-y

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