Re-investigating the Impact of Economic Growth, Energy Consumption, Financial Development, Institutional Quality, and Globalization on Environmental Degradation in OECD Countries

OuYang Junyan (), Shah Syed Hasanat (), Khan Muhammad Kamran (), Bibi Munaza (), Quddoos Muhammad Umer () and Siddiqi Arslan Ahmad ()
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OuYang Junyan: School of Management, New York Institute of Technology, New York, NY 10041, United States of America
Shah Syed Hasanat: School of Economics, and Sino-Japanese joint Center of Economic Research, Jilin University, Jilin Province, PR China
Khan Muhammad Kamran: Management Studies Department, Bahria Business School, Bahria University, Islamabad, Pakistan
Bibi Munaza: Business Studies Department, Bahria Business School, Bahria University, Karachi, Pakistan
Quddoos Muhammad Umer: Department of Commerce, Bahaudin Zakariya University, Multan, Pakistan
Siddiqi Arslan Ahmad: Institute of Industrial and Control System, Karachi, Pakistan

Economics - The Open-Access, Open-Assessment Journal, 2024, vol. 18, issue 1, 14

Abstract: This study attempts to quantify various macroeconomic variables’ influences on environmental quality. Being significantly negative in character, the impacts of economic growth (EG), energy consumption (EC) levels, financial development (FD) tools, changes in institutional qualities (IQUs), and globalization (GLO) on environmental degradation are regarded worthy of research. The dynamic panel model reports robust results using quantile regression and generalized moment method approaches. Renewable EC, GLO, and IQU significantly reduce the negative impacts on the natural environment across all quantiles. In contrast, electricity consumption has a significant deleterious impact across all quantiles, except at the 95% level, where the impact is not detrimental. EG and FD produce significantly positive injurious effects on the environment across all quantiles. Our findings reveal that callous indifference to global environmental degradation should not be tolerated for economic and ethical reasons, and it falls on the OECD countries to show leadership and take the initiative. OECD countries can mitigate environmental degradation by sharing knowledge and experience of balancing growth to promote sustainable development and responsible consumption globally.

Keywords: economic growth; energy consumption; financial development; institutional quality; globalization; environmental degradation; OECD (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:bpj:econoa:v:18:y:2024:i:1:p:14:n:1023

DOI: 10.1515/econ-2022-0077

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