The Symmetric and Asymmetric Impacts of Energy Consumption and Economic Growth on Environmental Sustainability

Atef Alshehry and Mounir Belloumi ()
Additional contact information
Atef Alshehry: Department of Business Administration, College of Business Administration, Najran University, Najran 61441, Saudi Arabia
Mounir Belloumi: Department of Business Administration, College of Business Administration, Najran University, Najran 61441, Saudi Arabia

Sustainability, 2023, vol. 16, issue 1, 1-17

Abstract: Climate change has emerged as a global challenge because of its threat to sustainable development goals. Fossil fuels and economic growth are responsible for pollution and, thus, for climate change. In this context, this study explored the environmental Kuznets curve hypothesis for the case of 17 MENA countries over the period of 1990–2020. It investigated the symmetric and asymmetric impact of energy consumption and economic growth on CO 2 emissions by controlling for population density, trade openness, and FDI inflows using panel linear and nonlinear ARDL models. The robustness of the results was checked using the fully modified OLS and dynamic OLS methods. Moreover, the Dumitrescu–Hurlin panel causality test was employed to determine the directions of causality between the variables. Overall, the empirical results of both panel linear and nonlinear ARDL models validate the environmental Kuznets curve hypothesis for the selected sample of MENA countries. Economic growth leads to environmental degradation only in the long run, whereas a rise in energy consumption leads to an increase in pollution in both the short and long run. These results are confirmed by the fully modified OLS and dynamic OLS methods. The findings of the Dumitrescu–Hurlin panel causality test also indicate the existence of bidirectional causality between energy consumption and CO 2 emissions and between economic growth and CO 2 emissions. Therefore, policy makers in the MENA region should invest in clean technologies and accelerate the transition to renewable energies such solar energy, wind power, and hydropower to align with sustainable development goals.

Keywords: CO 2 emissions; energy consumption; economic growth; nonlinear panel ARDL model; pooled mean group estimator; MENA (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/16/1/205/pdf (application/pdf)
https://www.mdpi.com/2071-1050/16/1/205/ (text/html)

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:gam:jsusta:v:16:y:2023:i:1:p:205-:d:1307477

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().