Is Bangladesh on the right path toward sustainable development? An empirical exploration of energy sources, economic growth, and CO2 discharges nexus

Md. Bokhtiar Hasan, Md. Sumon Ali, Gazi Uddin, Masnun Al Mahi, Yang Liu and Donghyun Park

Resources Policy, 2022, vol. 79, issue C

Abstract: The sustainability of the recent economic progress of Bangladesh is critically dependent on how it faces environmental challenges, as the country is one of the primary victims of climate alteration. Taking into account the crucial roles of energy sources in this scenario, we analyze the impacts of non-renewable and renewable energy consumption (NREC and REC) on the growth-environment nexus in Bangladesh from 1980 to 2018. Based on the Auto-Regressive Distributed Lag (ARDL) model with and without structural breaks and policy dummies, our findings show that REC significantly upsurges economic growth, whereas NREC diminishes it. However, NREC leads to environmental deterioration, while REC enhances environmental quality. Besides, our results fail to support the Environmental Kuznets Curve hypothesis for Bangladesh. Interestingly, the policy dummy upsurges CO2 discharges while lessening economic growth, implying that the Bangladesh government's policies do not adequately cut pollution. Our Toda-Yamamoto non-causality test indicates a unidirectional causality running from GDP and its square term and NREC to CO2 emissions. Our findings suggest that policymakers in Bangladesh should adopt and implement strategies like enhancing renewable energy production, investment subsidies, tax credits, quota policies, and technological advancements to boost REC while plunging NREC to achieve economic sustainability.

Keywords: Non-renewable energy; Renewable energy; Economic growth; CO2 discharges; Sustainable development; Bangladesh (search for similar items in EconPapers)
JEL-codes: C22 O10 Q42 Q43 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jrpoli:v:79:y:2022:i:c:s0301420722005682

DOI: 10.1016/j.resourpol.2022.103125

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