Does financial and economic expansion allow for environmental sustainability? Fresh insights from a new composite index and PSTR analysis

Hossein Ali Fakher and Muntasir Murshed

Journal of Environmental Planning and Management, 2024, vol. 67, issue 12, 2885-2908

Abstract: Despite the use of different environmental proxies, the economic and financial development (FD)-environmental quality (EQ) nexus is still enigmatic. In this regard, a new composite environmental quality index (CEQI) is used to holistically represent EQ. Moreover, the Panel Smooth Transition Regression (PSTR) method is applied to estimate the Environmental Kuznets Curve (EKC) and the financial development Kuznets Curve (FKC) hypotheses using data from 13 members of the Organization of the Petroleum Exporting Countries (OPEC). The findings reveal that economic growth in the first regime positively affects CEQI while having a negative effect after exceeding the threshold and entering the second regime. Also, FD positively affects CEQI for the first regime and has a negative influence for the second regime. Other factors such as energy consumption and composite trade share (CTS) in both the first and second regimes have a negative effect on CEQI. Accordingly, several environmental quality-improving policies are recommended.

Date: 2024
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://hdl.handle.net/10.1080/09640568.2023.2205997 (text/html)
Access to full text is restricted to subscribers.

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:taf:jenpmg:v:67:y:2024:i:12:p:2885-2908

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/CJEP20

DOI: 10.1080/09640568.2023.2205997

Access Statistics for this article

Journal of Environmental Planning and Management is currently edited by Dr Neil Powe, Dr Ken Willis and George Bill Page

More articles in Journal of Environmental Planning and Management from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().