IDEAS home Printed from https://ideas.repec.org/a/eee/renene/v195y2022icp203-213.html
   My bibliography  Save this article

Impact of industrialization and non-renewable energy on environmental pollution in Australia: Do renewable energy and financial development play a mitigating role?

Author

Listed:
  • Rahman, Mohammad Mafizur
  • Alam, Khosrul

Abstract

Environmental pollution is a principal concern for all countries. In particular, the issue is alarming for Australia as the country has been suffering from various environmental disasters for some recent years. Therefore, examination the roles of some variables that are related to environment are vital. To this end, this work endeavors to ascertain the impacts of industrialization, non-renewable and renewable energy use, and financial development on environmental pollution in Australia. Using the data period of 1990–2020, a series of econometric techniques such as the Augmented Dickey-Fuller test, Phillips-Perron test, Autoregressive Distributive Lag (ARDL) bounds test and the pairwise Granger causality test are applied. The findings reveal that industrialization and non-renewable energy use increase while the square of industrialization, renewable energy use, and financial development reduces CO2 emissions in Australia. The validation of the environmental Kuznets’ curve (EKC) hypothesis is also found. Bidirectional and unidirectional causal association of the studied variables with CO2 emissions are attained. All the outcomes are theoretically and empirically relevant and have important policy implications.

Suggested Citation

  • Rahman, Mohammad Mafizur & Alam, Khosrul, 2022. "Impact of industrialization and non-renewable energy on environmental pollution in Australia: Do renewable energy and financial development play a mitigating role?," Renewable Energy, Elsevier, vol. 195(C), pages 203-213.
    • Handle: RePEc:eee:renene:v:195:y:2022:i:c:p:203-213
    DOI: 10.1016/j.renene.2022.06.012
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960148122008436
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.renene.2022.06.012?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Chen, Yulong & Wang, Zheng & Zhong, Zhangqi, 2019. "CO2 emissions, economic growth, renewable and non-renewable energy production and foreign trade in China," Renewable Energy, Elsevier, vol. 131(C), pages 208-216.
    2. Rahman, Mohammad Mafizur & Kashem, Mohammad Abul, 2017. "Carbon emissions, energy consumption and industrial growth in Bangladesh: Empirical evidence from ARDL cointegration and Granger causality analysis," Energy Policy, Elsevier, vol. 110(C), pages 600-608.
    3. Azam, Anam & Rafiq, Muhammad & Shafique, Muhammad & Zhang, Haonan & Yuan, Jiahai, 2021. "Analyzing the effect of natural gas, nuclear energy and renewable energy on GDP and carbon emissions: A multi-variate panel data analysis," Energy, Elsevier, vol. 219(C).
    4. Vural, Gulfer, 2020. "How do output, trade, renewable energy and non-renewable energy impact carbon emissions in selected Sub-Saharan African Countries?," Resources Policy, Elsevier, vol. 69(C).
    5. Rahman, Mohammad Mafizur & Vu, Xuan-Binh, 2020. "The nexus between renewable energy, economic growth, trade, urbanisation and environmental quality: A comparative study for Australia and Canada," Renewable Energy, Elsevier, vol. 155(C), pages 617-627.
    6. Yilmaz Bayar & Marius Dan Gavriletea & Stefan Sauer & Dragos Paun, 2021. "Impact of Municipal Waste Recycling and Renewable Energy Consumption on CO 2 Emissions across the European Union (EU) Member Countries," Sustainability, MDPI, vol. 13(2), pages 1-12, January.
    7. M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
    8. Shahnazi, Rouhollah & Dehghan Shabani, Zahra, 2021. "The effects of renewable energy, spatial spillover of CO2 emissions and economic freedom on CO2 emissions in the EU," Renewable Energy, Elsevier, vol. 169(C), pages 293-307.
    9. Shahbaz, Muhammad & Hye, Qazi Muhammad Adnan & Tiwari, Aviral Kumar & Leitão, Nuno Carlos, 2013. "Economic growth, energy consumption, financial development, international trade and CO2 emissions in Indonesia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 25(C), pages 109-121.
    10. Dong, Kangyin & Hochman, Gal & Zhang, Yaqing & Sun, Renjin & Li, Hui & Liao, Hua, 2018. "CO2 emissions, economic and population growth, and renewable energy: Empirical evidence across regions," Energy Economics, Elsevier, vol. 75(C), pages 180-192.
    11. Opoku, Eric Evans Osei & Boachie, Micheal Kofi, 2020. "The environmental impact of industrialization and foreign direct investment," Energy Policy, Elsevier, vol. 137(C).
    12. Enrico Maria Mosconi & Andrea Colantoni & Filippo Gambella & Eva Cudlinová & Luca Salvati & Jesús Rodrigo-Comino, 2020. "Revisiting the Environmental Kuznets Curve: The Spatial Interaction between Economy and Territory," Economies, MDPI, vol. 8(3), pages 1-20, September.
    13. Ehigiamusoe, Kizito Uyi & Dogan, Eyup, 2022. "The role of interaction effect between renewable energy consumption and real income in carbon emissions: Evidence from low-income countries," Renewable and Sustainable Energy Reviews, Elsevier, vol. 154(C).
    14. Jean Pierre Namahoro & Qiaosheng Wu & Haijun Xiao & Na Zhou, 2021. "The Impact of Renewable Energy, Economic and Population Growth on CO 2 Emissions in the East African Region: Evidence from Common Correlated Effect Means Group and Asymmetric Analysis," Energies, MDPI, vol. 14(2), pages 1-21, January.
    15. Mohammad Mafizur Rahman & Khosrul Alam, 2022. "CO 2 Emissions in Asia–Pacific Region: Do Energy Use, Economic Growth, Financial Development, and International Trade Have Detrimental Effects?," Sustainability, MDPI, vol. 14(9), pages 1-16, April.
    16. Chen, Yulong & Zhao, Jincai & Lai, Zhizhu & Wang, Zheng & Xia, Haibin, 2019. "Exploring the effects of economic growth, and renewable and non-renewable energy consumption on China’s CO2 emissions: Evidence from a regional panel analysis," Renewable Energy, Elsevier, vol. 140(C), pages 341-353.
    17. Zoundi, Zakaria, 2017. "CO2 emissions, renewable energy and the Environmental Kuznets Curve, a panel cointegration approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 72(C), pages 1067-1075.
    18. Inglesi-Lotz, Roula & Dogan, Eyup, 2018. "The role of renewable versus non-renewable energy to the level of CO2 emissions a panel analysis of sub- Saharan Africa’s Βig 10 electricity generators," Renewable Energy, Elsevier, vol. 123(C), pages 36-43.
    19. Granger, C W J, 1969. "Investigating Causal Relations by Econometric Models and Cross-Spectral Methods," Econometrica, Econometric Society, vol. 37(3), pages 424-438, July.
    20. Rahman, Mohammad Mafizur, 2017. "Do population density, economic growth, energy use and exports adversely affect environmental quality in Asian populous countries?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 77(C), pages 506-514.
    21. Boutabba, Mohamed Amine, 2014. "The impact of financial development, income, energy and trade on carbon emissions: Evidence from the Indian economy," Economic Modelling, Elsevier, vol. 40(C), pages 33-41.
    22. Shafiei, Sahar & Salim, Ruhul A., 2014. "Non-renewable and renewable energy consumption and CO2 emissions in OECD countries: A comparative analysis," Energy Policy, Elsevier, vol. 66(C), pages 547-556.
    23. Zhang, Yue-Jun, 2011. "The impact of financial development on carbon emissions: An empirical analysis in China," Energy Policy, Elsevier, vol. 39(4), pages 2197-2203, April.
    24. Pata, Ugur Korkut & Caglar, Abdullah Emre, 2021. "Investigating the EKC hypothesis with renewable energy consumption, human capital, globalization and trade openness for China: Evidence from augmented ARDL approach with a structural break," Energy, Elsevier, vol. 216(C).
    25. Odhiambo, Nicholas M, 2020. "Financial development,income inequality and carbon emissions in Sub-Saharan African countries: A panel data analysis," Working Papers 26645, University of South Africa, Department of Economics.
    26. Rahman, Mohammad Mafizur & Mamun, Shamsul Arifeen Khan, 2016. "Energy use, international trade and economic growth nexus in Australia: New evidence from an extended growth model," Renewable and Sustainable Energy Reviews, Elsevier, vol. 64(C), pages 806-816.
    27. Dogan, Eyup & Seker, Fahri, 2016. "The influence of real output, renewable and non-renewable energy, trade and financial development on carbon emissions in the top renewable energy countries," Renewable and Sustainable Energy Reviews, Elsevier, vol. 60(C), pages 1074-1085.
    28. Adedoyin, Festus Fatai & Ozturk, Ilhan & Bekun, Festus Victor & Agboola, Phillips O. & Agboola, Mary Oluwatoyin, 2021. "Renewable and non-renewable energy policy simulations for abating emissions in a complex economy: Evidence from the novel dynamic ARDL," Renewable Energy, Elsevier, vol. 177(C), pages 1408-1420.
    29. Ozturk, Ilhan & Acaravci, Ali, 2013. "The long-run and causal analysis of energy, growth, openness and financial development on carbon emissions in Turkey," Energy Economics, Elsevier, vol. 36(C), pages 262-267.
    30. Anwar, Ahsan & Siddique, Muhammad & Eyup Dogan, & Sharif, Arshian, 2021. "The moderating role of renewable and non-renewable energy in environment-income nexus for ASEAN countries: Evidence from Method of Moments Quantile Regression," Renewable Energy, Elsevier, vol. 164(C), pages 956-967.
    31. Mohamed Amine Boutabba, 2014. "The impact of financial development, income, energy and trade on carbon emissions: Evidence from the Indian economy," Post-Print hal-02877966, HAL.
    32. Rahman, Mohammad Mafizur & Alam, Khosrul, 2021. "Clean energy, population density, urbanization and environmental pollution nexus: Evidence from Bangladesh," Renewable Energy, Elsevier, vol. 172(C), pages 1063-1072.
    33. Erwin Gunawan Hutapea, 2007. "Credit Downturn In The Aftermath Of Indonesian Crisis 1997 Revisited: An Application Of Ardl Bounds Testing Approach," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 9(4), pages 1-18, April.
    34. Chun Jiang & Xiaoxin Ma, 2019. "The Impact of Financial Development on Carbon Emissions: A Global Perspective," Sustainability, MDPI, vol. 11(19), pages 1-22, September.
    35. Mahalik, Mantu Kumar & Mallick, Hrushikesh & Padhan, Hemachandra, 2021. "Do educational levels influence the environmental quality? The role of renewable and non-renewable energy demand in selected BRICS countries with a new policy perspective," Renewable Energy, Elsevier, vol. 164(C), pages 419-432.
    36. Urszula Mentel & Elżbieta Wolanin & Mansur Eshov & Raufhon Salahodjaev, 2022. "Industrialization and CO 2 Emissions in Sub-Saharan Africa: The Mitigating Role of Renewable Electricity," Energies, MDPI, vol. 15(3), pages 1-12, January.
    37. Dogan, Eyup & Seker, Fahri, 2016. "Determinants of CO2 emissions in the European Union: The role of renewable and non-renewable energy," Renewable Energy, Elsevier, vol. 94(C), pages 429-439.
    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. Suzanna ElMassah & Eslam A. Hassanein, 2023. "Economic Development and Environmental Sustainability in the GCC Countries: New Insights Based on the Economic Complexity," Sustainability, MDPI, vol. 15(10), pages 1-24, May.
    2. Tonghui Yu & Xuan Huang & Shanshan Jia & Xufeng Cui, 2023. "Unveiling the Spatio-Temporal Evolution and Key Drivers for Urban Green High-Quality Development: A Comparative Analysis of China’s Five Major Urban Agglomerations," Land, MDPI, vol. 12(11), pages 1-25, October.
    3. Hui Yuan & Wei Cen & Tao Du, 2023. "Digital Finance and County Ecological Performance—New Evidence from China Counties," Sustainability, MDPI, vol. 15(24), pages 1-21, December.
    4. Taghizadeh-Hesary, Farhad & Dong, Kangyin & Zhao, Congyu & Phoumin, Han, 2023. "Can financial and economic means accelerate renewable energy growth in the climate change era? The case of China," Economic Analysis and Policy, Elsevier, vol. 78(C), pages 730-743.
    5. Xiaohong Liu, 2023. "Impacts of Environmental Pollution and Digital Economy on the New Energy Industry," Sustainability, MDPI, vol. 15(12), pages 1-15, June.
    6. Jahanger, Atif & Zubair Chishti, Muhammad & Chukwuma Onwe, Joshua & Awan, Ashar, 2022. "How far renewable energy and globalization are useful to mitigate the environment in Mexico? Application of QARDL and spectral causality analysis," Renewable Energy, Elsevier, vol. 201(P1), pages 514-525.
    7. Badeeb, Ramez Abubakr & Wang, Bo & Zhao, Jun & Khan, Zeeshan & Uktamov, Khusniddin Fakhriddinovich & Zhang, Changyong, 2023. "Natural resources extraction and financial inclusion: Linear and non-linear effect of natural resources on financial sector," Resources Policy, Elsevier, vol. 85(PA).
    8. Yuling Yuan & Dukangqi Li, 2023. "Urban Economic Efficiency, Environmental Factors, and Digital Finance: Impacts on Sustainable Development in Chinese Cities," Sustainability, MDPI, vol. 15(18), pages 1-22, September.
    9. Liao, Jixiang & Liu, Xingye & Zhou, Xueyan & Tursunova, Nargiza Rakhimovna, 2023. "Analyzing the role of renewable energy transition and industrialization on ecological sustainability: Can green innovation matter in OECD countries," Renewable Energy, Elsevier, vol. 204(C), pages 141-151.
    10. Ding, Wangwang & Du, Juntao & Kazancoglu, Yigit & Mangla, Sachin Kumar & Song, Malin, 2023. "Financial development and the energy net-zero transformation potential," Energy Economics, Elsevier, vol. 125(C).

    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. Mohammad Mafizur Rahman & Khosrul Alam, 2022. "CO 2 Emissions in Asia–Pacific Region: Do Energy Use, Economic Growth, Financial Development, and International Trade Have Detrimental Effects?," Sustainability, MDPI, vol. 14(9), pages 1-16, April.
    2. Rahman, Mohammad Mafizur & Alam, Khosrul, 2022. "Effects of corruption, technological innovation, globalisation, and renewable energy on carbon emissions in Asian countries," Utilities Policy, Elsevier, vol. 79(C).
    3. Chen, Chaoyi & Pinar, Mehmet & Stengos, Thanasis, 2022. "Renewable energy and CO2 emissions: New evidence with the panel threshold model," Renewable Energy, Elsevier, vol. 194(C), pages 117-128.
    4. Karaaslan, Abdulkerim & Çamkaya, Serhat, 2022. "The relationship between CO2 emissions, economic growth, health expenditure, and renewable and non-renewable energy consumption: Empirical evidence from Turkey," Renewable Energy, Elsevier, vol. 190(C), pages 457-466.
    5. AhAtil, Ahmed & Bouheni, Faten Ben & Lahiani, Amine & Shahbaz, Muhammad, 2019. "Factors influencing CO2 Emission in China: A Nonlinear Autoregressive Distributed Lags Investigation," MPRA Paper 91190, University Library of Munich, Germany, revised 02 Jan 2019.
    6. Shahbaz, Muhammad & Nasir, Muhammad Ali & Roubaud, David, 2018. "Environmental degradation in France: The effects of FDI, financial development, and energy innovations," Energy Economics, Elsevier, vol. 74(C), pages 843-857.
    7. Ertugrul, Hasan Murat & Çetin, Murat & Şeker, Fahri & Dogan, Eyüp, 2015. "The impact of trade openness on global carbon dioxide emissions: Evidence from the top ten emitters among developing countries," MPRA Paper 97539, University Library of Munich, Germany, revised 10 Mar 2016.
    8. Md. Golam Kibria & Ismay Jahan & Jannatul Mawa, 2021. "Asymmetric effect of financial development and energy consumption on environmental degradation in South Asia? New evidence from non-linear ARDL analysis," SN Business & Economics, Springer, vol. 1(4), pages 1-18, April.
    9. Anh The Vo & Duc Hong Vo & Quan Thai-Thuong Le, 2019. "CO 2 Emissions, Energy Consumption, and Economic Growth: New Evidence in the ASEAN Countries," JRFM, MDPI, vol. 12(3), pages 1-20, September.
    10. Junsong Jia & Jing Lei & Chundi Chen & Xu Song & Yexi Zhong, 2021. "Contribution of Renewable Energy Consumption to CO 2 Emission Mitigation: A Comparative Analysis from a Global Geographic Perspective," Sustainability, MDPI, vol. 13(7), pages 1-23, March.
    11. Sudipa Majumdar & Cody Morris Paris, 2022. "Environmental Impact of Urbanization, Bank Credits, and Energy Use in the UAE—A Tourism-Induced EKC Model," Sustainability, MDPI, vol. 14(13), pages 1-14, June.
    12. Muhammad Qayyum & Minhaj Ali & Mir Muhammad Nizamani & Shijie Li & Yuyuan Yu & Atif Jahanger, 2021. "Nexus between Financial Development, Renewable Energy Consumption, Technological Innovations and CO 2 Emissions: The Case of India," Energies, MDPI, vol. 14(15), pages 1-19, July.
    13. Rahman, Mohammad Mafizur & Alam, Khosrul, 2021. "Clean energy, population density, urbanization and environmental pollution nexus: Evidence from Bangladesh," Renewable Energy, Elsevier, vol. 172(C), pages 1063-1072.
    14. Mohammad Mafizur Rahman & Xuan-Binh (Benjamin) Vu, 2021. "Are Energy Consumption, Population Density and Exports Causing Environmental Damage in China? Autoregressive Distributed Lag and Vector Error Correction Model Approaches," Sustainability, MDPI, vol. 13(7), pages 1-19, March.
    15. Shahbaz, Muhammad & Hoang, Thi Hong Van & Mahalik, Mantu Kumar & Roubaud, David, 2017. "Energy consumption, financial development and economic growth in India: New evidence from a nonlinear and asymmetric analysis," Energy Economics, Elsevier, vol. 63(C), pages 199-212.
    16. 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.
    17. Rauf, Abdul & Zhang, Jin & Li, Jinkai & Amin, Waqas, 2018. "Structural changes, energy consumption and carbon emissions in China: Empirical evidence from ARDL bound testing model," Structural Change and Economic Dynamics, Elsevier, vol. 47(C), pages 194-206.
    18. Rahman, Mohammad Mafizur & Kashem, Mohammad Abul, 2017. "Carbon emissions, energy consumption and industrial growth in Bangladesh: Empirical evidence from ARDL cointegration and Granger causality analysis," Energy Policy, Elsevier, vol. 110(C), pages 600-608.
    19. Khan, Muhammad Tariq Iqbal & Yaseen, Muhammad Rizwan & Ali, Qamar, 2019. "Nexus between financial development, tourism, renewable energy, and greenhouse gas emission in high-income countries: A continent-wise analysis," Energy Economics, Elsevier, vol. 83(C), pages 293-310.
    20. Abbasi, Kashif Raza & Hussain, Khadim & Redulescu, Magdalena & Ozturk, Ilhan, 2021. "Does natural resources depletion and economic growth achieve the carbon neutrality target of the UK? A way forward towards sustainable development," Resources Policy, Elsevier, vol. 74(C).

    More about this item

    Keywords

    CO2 emissions; Industrialization; Renewable and non-renewable energy; Financial development; Australia;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

    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:eee:renene:v:195:y:2022:i:c:p:203-213. 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: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/renewable-energy .

    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.