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Is Economic Growth And Industrial Growth The Reason For Environmental Degradation In Saarc Countries

Author

Listed:
  • Atif Khan Jadoon

    (Department of Economics, School of Economics, University of the Punjab, Pakistan)

  • Sania Akhtar

    (Department of Economics, School of Economics, University of the Punjab, Pakistan)

  • Ambreen Sarwar

    (Department of Economics, School of Economics, University of the Punjab, Pakistan)

  • Syeda Azra Batool

    (School of Economics, Bahauddin Zakariya University, Pakistan,)

  • Sarvjeet Kaur Chatrath

    (Canberra Business School, University of Canberra, Australia,)

  • Saima Liaqat

    (Department of Economics, Lahore College for Women Universirty, Lahore, Pakistan.)

Abstract

In the last four decades, the developing countries have built a heavy industrial base which is seen as a threat to the environment. The trade liberalization policies of the SAARC countries led them to increase the production for domestic use and exports. This increase in industrial output is a real threat to environmental degradation as the industrial share is quite significant in the GDP of the SAARC countries. The present study is designed to check the existence of the Environmental Kuznets Curve (EKC) hypothesis and then use industry output as a regressor to see how it is affecting the environment. The panel regression models are used for estimation by taking data from 1980 to 2018. The results are obtained by using Newey-West standard robust errors. The results suggested that there exists a U-shape relationship between economic growth and Carbon Dioxide (CO2) while an inverted U-shape relationship is found between industrial growth and CO2. Furthermore, a unidirectional causality was observed between industrial growth, human capital, energy consumption, and CO2 while bidirectional causality was observed between urbanization and CO2. The present study suggests that there is a need to adopt environmental protection policies related to the industrial sector in the SAARC region.

Suggested Citation

  • Atif Khan Jadoon & Sania Akhtar & Ambreen Sarwar & Syeda Azra Batool & Sarvjeet Kaur Chatrath & Saima Liaqat, 2021. "Is Economic Growth And Industrial Growth The Reason For Environmental Degradation In Saarc Countries," International Journal of Energy Economics and Policy, Econjournals, vol. 11(6), pages 418-426.
    • Handle: RePEc:eco:journ2:2021-06-48
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    Cited by:

    1. Rehana Firdous & Sarvjeet Kaur Chatrath & Atif Khan Jadoon & Munawar Iqbal & Syeda Azra Batool & Zameer Ul Hasan, 2023. "Exploring Dynamic Nexus between Economic Growth, Environmental Degradation, and Public Health in Pakistan: A Moderated Mediation Approach," International Journal of Energy Economics and Policy, Econjournals, vol. 13(1), pages 241-249, January.
    2. Liton Chandra Voumik & Mohammad Iqbal Hossain & Md. Hasanur Rahman & Raziya Sultana & Rahi Dey & Miguel Angel Esquivias, 2023. "Impact of Renewable and Non-Renewable Energy on EKC in SAARC Countries: Augmented Mean Group Approach," Energies, MDPI, vol. 16(6), pages 1-19, March.

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    More about this item

    Keywords

    Economic Growth; Idustrial Growth; Environmental Degradation;
    All these keywords.

    JEL classification:

    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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