The importance of public sector size and resources volatility in carbon emissions: Empirical evidence from OECD countries

Qiu Lei, Weiyun Huang, Fang Zhao, Saima Sarwar and Muhammad Gulzaib Chaudhary

Resources Policy, 2023, vol. 85, issue PA

Abstract: Natural resources and environmental depletion are significant concerns for both developing and developed nations. Those challenges not only surge environmental risks but also result in extensive financial damages, leading to the provision of substantial funds each year for carbon mitigation strategies. The present study aims to inspect the impact of public sector size and natural resource volatility on environmental depletion by evaluating panel data from twenty OECD member countries. Based on data availability, the selected time frame for analysis is 1995–2021. The study employs the Augmented Mean Group (AMG) approach to address potential biases arising from cross-sectional dependence (CD) and slope heterogeneity. The findings depicted a positive relationship between public sector size, natural resource volatility, and carbon dioxide (CO2) emissions in selected OECD countries. The results underscore that an increased share of government expenditures and high natural resource volatility contribute to carbon emissions. These outcomes highlight the need to condemn the highly volatile consumption of natural resources to bring stability in the resources markets and also condemn irresponsible financing of environmentally unfriendly projects for the sake of a healthier environment. The study proposed that governments should pay attention to prioritizing environmental quality when utilizing natural resources or allocating funds across various sectors.

Keywords: Resources volatility; CO2 emissions; Economic growth; Public sector size; OECD economies (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://www.sciencedirect.com/science/article/pii/S0301420723006797
Full text for ScienceDirect subscribers only

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:eee:jrpoli:v:85:y:2023:i:pa:s0301420723006797

DOI: 10.1016/j.resourpol.2023.103968

Access Statistics for this article

Resources Policy is currently edited by R. G. Eggert

More articles in Resources Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().