Economic complexity and environmental pollution: evidence from the former socialist transition countries

Florian Bucher, Lucas Scheu and Benedikt Schröpf ()
Additional contact information
Florian Bucher: Andrássy University Budapest
Lucas Scheu: Andrássy University Budapest
Benedikt Schröpf: University of Erlangen-Nürnberg

Empirica, 2023, vol. 50, issue 3, No 8, 807-847

Abstract: Abstract This study examines the link between economic complexity and environmental pollution by exploiting a massive and unprecedented decline of CO2 emissions and complexity in the former socialist transition countries after the fall of the iron curtain. We refer to the extended theories of the Environmental Kuznets Curve (EKC), stating that environmental pollution follows an inverted u-shaped course with respect to economic complexity. Using comprehensive data of 27 countries for the period 1995–2017, our results show that the EKC can be found for countries whose complexity rose over time. Additionally, since the results for production-based and consumption-based CO2 emissions are similar, we can discard emissions offshoring as a major explaining factor. Consequently, our findings suggest that more complex products have influenced the u-shaped course of the EKC. However, as the turning point is associated with high levels of pollution, our estimates imply that complexity may even exacerbate environmental issues in the short and middle run in less developed countries.

Keywords: Economic complexity; Environmental Kuznets Curve; Former socialist states (search for similar items in EconPapers)
JEL-codes: O44 P2 (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://link.springer.com/10.1007/s10663-023-09575-y Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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:kap:empiri:v:50:y:2023:i:3:d:10.1007_s10663-023-09575-y

Ordering information: This journal article can be ordered from
http://www.springer. ... ration/journal/10663

DOI: 10.1007/s10663-023-09575-y

Access Statistics for this article

Empirica is currently edited by Fritz Breuss and Fritz Breuss

More articles in Empirica from Springer, Austrian Institute for Economic Research, Austrian Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().