IDEAS home Printed from https://ideas.repec.org/a/eco/journ2/2021-02-50.html
   My bibliography  Save this article

Significance of Economic Activities in Environmental Protection: Evidence from a Panel of 4-ASEAN Economies

Author

Listed:
  • Satria Tirtayasa

    (Universitas Muhammadiyah Sumatera Utara, Jl. Kapten Muchtar Basri No. 3, Medan, Sumatera Utara 20238, Indonesia,)

  • A. Akrim

    (Universitas Muhammadiyah Sumatera Utara, Jl. Kapten Muchtar Basri No. 3, Medan, Sumatera Utara 20238, Indonesia,)

  • Ade Gunawan

    (Universitas Muhammadiyah Sumatera Utara, Jl. Kapten Muchtar Basri No. 3, Medan, Sumatera Utara 20238, Indonesia,)

  • Emilda Sulasmi

    (Universitas Muhammadiyah Sumatera Utara, Jl. Kapten Muchtar Basri No. 3, Medan, Sumatera Utara 20238, Indonesia,)

  • Hastin Umi Anisah

    (Universitas Lambuung Mangkurat, Jl. H. Hasan Basry, Banjarmasin, Kalimantan Selatan 70123, Indonesia.)

Abstract

Environmental degradation is increasing gradually due to economic activities by the Association of Southeast Asian Nations (ASEAN). ASEAN energy center estimated 4.4% increase in the consumption of final energy among ASEAN nations in 2030 which is greater than the average growth rate of 1.44%. The current study empirically analyzes the impact of economic activities on environmental protection across four largest ASEAN economies (Indonesia, Thailand, Singapore and Malaysia) over a period of 1998-2018. In order to achieve this objective, the study employs several panel econometric tests; ADF, panel cross-sectional dependence, Johansen-Fisher panel cointegration, FMOLS and country specific long run output method. The study finds significant positive impact of non-renewable energy consumption (NRNC), GDP and labor force on CO2 emission. Renewable energy consumption (RNC) has negative impact on CO2 emission. As RNC causes reducing CO2 emission in the sample ASEAN economies, the study suggests the policy makers to inductee effective policies to encourage the generation of renewable energy and its uses across ASEAN economies. While the generation of non-renewable energy should be discouraged as it promotes CO2 emission.

Suggested Citation

  • Satria Tirtayasa & A. Akrim & Ade Gunawan & Emilda Sulasmi & Hastin Umi Anisah, 2021. "Significance of Economic Activities in Environmental Protection: Evidence from a Panel of 4-ASEAN Economies," International Journal of Energy Economics and Policy, Econjournals, vol. 11(2), pages 420-426.
  • Handle: RePEc:eco:journ2:2021-02-50
    as

    Download full text from publisher

    File URL: https://www.econjournals.com/index.php/ijeep/article/download/10831/5752
    Download Restriction: no

    File URL: https://www.econjournals.com/index.php/ijeep/article/view/10831/5752
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Halicioglu, Ferda, 2009. "An econometric study of CO2 emissions, energy consumption, income and foreign trade in Turkey," Energy Policy, Elsevier, vol. 37(3), pages 1156-1164, March.
    2. Meng Yan & Zhen An, 2017. "Foreign Direct Investment and Environmental Pollution: New Evidence from China," Econometrics Letters, Bilimsel Mektuplar Organizasyonu (Scientific letters), vol. 4(1), pages 1-17.
    3. Huang, Zhehao & Liao, Gaoke & Li, Zhenghui, 2019. "Loaning scale and government subsidy for promoting green innovation," Technological Forecasting and Social Change, Elsevier, vol. 144(C), pages 148-156.
    4. Ito, Katsuya, 2017. "CO2 emissions, renewable and non-renewable energy consumption, and economic growth: Evidence from panel data for developing countries," International Economics, Elsevier, vol. 151(C), pages 1-6.
    5. Muhammad Shahbaz & Syed Jawad Hussain Shahzad & Mantu Kumar Mahalik & Perry Sadorsky, 2018. "How strong is the causal relationship between globalization and energy consumption in developed economies? A country-specific time-series and panel analysis," Applied Economics, Taylor & Francis Journals, vol. 50(13), pages 1479-1494, March.
    6. J. Scott Holladay, 2016. "Exporters and the environment," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 49(1), pages 147-172, February.
    7. Ang, James B., 2007. "CO2 emissions, energy consumption, and output in France," Energy Policy, Elsevier, vol. 35(10), pages 4772-4778, October.
    8. Paul M Vaaler, 2011. "Immigrant remittances and the venture investment environment of developing countries," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 42(9), pages 1121-1149, December.
    9. Rafael Alvarado & Elisa Toledo, 2017. "Environmental degradation and economic growth: evidence for a developing country," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 19(4), pages 1205-1218, August.
    10. Muhammad Aminu Haruna & Suraya Mahmood, 2018. "Impact of Energy Consumption and Environmental Pollution in Malaysia," Energy Economics Letters, Asian Economic and Social Society, vol. 5(1), pages 31-43, March.
    11. Richard Perkins & Eric Neumayer, 2012. "Do recipient country characteristics affect international spillovers of CO 2 -efficiency via trade and foreign direct investment?," Climatic Change, Springer, vol. 112(2), pages 469-491, May.
    12. Elena Stupnikova & Tatyana Sukhadolets, 2019. "Construction Sector Role in Gross Fixed Capital Formation: Empirical Data from Russia," Economies, MDPI, vol. 7(2), pages 1-16, May.
    13. Shi, Anqing, 2003. "The impact of population pressure on global carbon dioxide emissions, 1975-1996: evidence from pooled cross-country data," Ecological Economics, Elsevier, vol. 44(1), pages 29-42, February.
    14. Jiajia Zheng & Pengfei Sheng, 2017. "The Impact of Foreign Direct Investment (FDI) on the Environment: Market Perspectives and Evidence from China," Economies, MDPI, vol. 5(1), pages 1-15, March.
    15. A. Kahuthu, 2006. "Economic Growth and Environmental Degradation in a Global Context," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 8(1), pages 55-68, February.
    16. Azilah Hasnisah & A. A. Azlina & Che Mohd Imran Che Taib, 2019. "The Impact of Renewable Energy Consumption on Carbon Dioxide Emissions: Empirical Evidence from Developing Countries in Asia," International Journal of Energy Economics and Policy, Econjournals, vol. 9(3), pages 135-143.
    17. Bhattacharya, Mita & Paramati, Sudharshan Reddy & Ozturk, Ilhan & Bhattacharya, Sankar, 2016. "The effect of renewable energy consumption on economic growth: Evidence from top 38 countries," Applied Energy, Elsevier, vol. 162(C), pages 733-741.
    18. Muhammad Aminu Haruna & Suraya Mahmood, 2018. "Impact of Energy Consumption and Environmental Pollution in Malaysia," Energy Economics Letters, Asian Economic and Social Society, vol. 5(1), pages 31-43.
    19. Ravnborg, Helle Munk, 2003. "Poverty and Environmental Degradation in the Nicaraguan Hillsides," World Development, Elsevier, vol. 31(11), pages 1933-1946, November.
    20. Zhenghui Li & Hao Dong & Zimei Huang & Pierre Failler, 2019. "Impact of Foreign Direct Investment on Environmental Performance," Sustainability, MDPI, vol. 11(13), pages 1-16, June.
    21. Katsuya Ito, 2017. "CO2 emissions, renewable and non-renewable energy consumption, and economic growth: Evidence from panel data for developing countries," International Economics, CEPII research center, issue 151, pages 1-6.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fitrah Sari Islami & Panji Kusuma Prasetyanto & Fitri Kurniasari, 2022. "The Effect of Population, GDP, Non-Renewable Energy Consumption and Renewable Energy Consumption on Carbon Dioxide Emissions in G-20 Member Countries," International Journal of Energy Economics and Policy, Econjournals, vol. 12(2), pages 103-110, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Nartraphee Tancho & Thanaporn Sriyakul & Changjiang Tang, 2020. "Asymmetric Impacts of Macroeconomy on Environment Degradation in Thailand: A NARDL Approach," Contemporary Economics, University of Economics and Human Sciences in Warsaw., vol. 14(4), December.
    2. Tri Andjarwati & N. Anggoro Panji & Agus Utomo & Linda Nur Susila & P. Anton Respati & Abdul Talib Bon, 2020. "Impact of Energy Consumption, and Economic Dynamics on Environmental Degradation in ASEAN," International Journal of Energy Economics and Policy, Econjournals, vol. 10(5), pages 672-678.
    3. Acheampong, Alex O. & Dzator, Janet & Savage, David A., 2021. "Renewable energy, CO2 emissions and economic growth in sub-Saharan Africa: Does institutional quality matter?," Journal of Policy Modeling, Elsevier, vol. 43(5), pages 1070-1093.
    4. Marques, António Cardoso & Fuinhas, José Alberto & Neves, Sónia Almeida, 2018. "Ordinary and Special Regimes of electricity generation in Spain: How they interact with economic activity," Renewable and Sustainable Energy Reviews, Elsevier, vol. 81(P1), pages 1226-1240.
    5. Muhammad K Anser & Muhammad Usman & Danish I Godil & Malik S Shabbir & Mosab Ismail Tabash & Munir Ahmad & Aysha Zamir & Lydia B Lopez, 2022. "Does air pollution affect clean production of sustainable environmental agenda through low carbon energy financing? evidence from ASEAN countries," Energy & Environment, , vol. 33(3), pages 472-486, May.
    6. Villanthenkodath, Muhammed Ashiq & Mahalik, Mantu Kumar, 2021. "Does economic growth respond to electricity consumption asymmetrically in Bangladesh? The implication for environmental sustainability," Energy, Elsevier, vol. 233(C).
    7. Alvarez-Herranz, Agustin & Balsalobre-Lorente, Daniel & Shahbaz, Muhammad & Cantos, José María, 2017. "Energy innovation and renewable energy consumption in the correction of air pollution levels," Energy Policy, Elsevier, vol. 105(C), pages 386-397.
    8. Jianguo Zhou & Baoling Jin & Shijuan Du & Ping Zhang, 2018. "Scenario Analysis of Carbon Emissions of Beijing-Tianjin-Hebei," Energies, MDPI, vol. 11(6), pages 1-17, June.
    9. Shahbaz, Muhammad & Raghutla, Chandrashekar & Chittedi, Krishna Reddy & Jiao, Zhilun & Vo, Xuan Vinh, 2020. "The effect of renewable energy consumption on economic growth: Evidence from the renewable energy country attractive index," Energy, Elsevier, vol. 207(C).
    10. Liang Xie & Xianzhong Mu & Kuanyuting Lu & Dongou Hu & Guangwen Hu, 2023. "The time-varying relationship between CO2 emissions, heterogeneous energy consumption, and economic growth in China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(8), pages 7769-7793, August.
    11. Marius-Corneliu Marinaș & Marin Dinu & Aura-Gabriela Socol & Cristian Socol, 2018. "Renewable energy consumption and economic growth. Causality relationship in Central and Eastern European countries," PLOS ONE, Public Library of Science, vol. 13(10), pages 1-29, October.
    12. Kangyin Dong & Xiucheng Dong & Qingzhe Jiang, 2020. "How renewable energy consumption lower global CO2 emissions? Evidence from countries with different income levels," The World Economy, Wiley Blackwell, vol. 43(6), pages 1665-1698, June.
    13. Muhammad Shahbaz & Avik Sinha, 2019. "Environmental Kuznets curve for CO2emissions: a literature survey," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 46(1), pages 106-168, January.
    14. Błażej Suproń & Janusz Myszczyszyn, 2023. "Impact of Renewable and Non-Renewable Energy Consumption and CO 2 Emissions on Economic Growth in the Visegrad Countries," Energies, MDPI, vol. 16(20), pages 1-20, October.
    15. Mohd Afjal & Chinnadurai Kathiravan & Leo Paul Dana & Chitra Devi Nagarajan, 2023. "The Dynamic Impact of Financial Technology and Energy Consumption on Environmental Sustainability," Sustainability, MDPI, vol. 15(12), pages 1-21, June.
    16. Muhammad Ikram, 2021. "Models for Predicting Non-Renewable Energy Competing with Renewable Source for Sustainable Energy Development: Case of Asia and Oceania Region," Global Journal of Flexible Systems Management, Springer;Global Institute of Flexible Systems Management, vol. 22(2), pages 133-160, December.
    17. Wang, Kuan-Min, 2012. "Modelling the nonlinear relationship between CO2 emissions from oil and economic growth," Economic Modelling, Elsevier, vol. 29(5), pages 1537-1547.
    18. Zhihui Lv & Amanda M. Y. Chu & Michael McAleer & Wing-Keung Wong, 2019. "Modelling Economic Growth, Carbon Emissions, and Fossil Fuel Consumption in China: Cointegration and Multivariate Causality," IJERPH, MDPI, vol. 16(21), pages 1-35, October.
    19. Doytch, Nadia & Narayan, Seema, 2021. "Does transitioning towards renewable energy accelerate economic growth? An analysis of sectoral growth for a dynamic panel of countries," Energy, Elsevier, vol. 235(C).
    20. Baye, Richmond Silvanus & Ahenkan, Albert & Darkwah, Samuel, 2021. "Renewable energy output in sub Saharan Africa," Renewable Energy, Elsevier, vol. 174(C), pages 705-714.

    More about this item

    Keywords

    Economic Activities; Energy Consumption; GDP; ASEAN; FMOLS.;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • K32 - Law and Economics - - Other Substantive Areas of Law - - - Energy, Environmental, Health, and Safety Law

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eco:journ2:2021-02-50. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ilhan Ozturk (email available below). General contact details of provider: http://www.econjournals.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.