IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i18p8394-d1753014.html
   My bibliography  Save this article

Economic Growth, FDI, Tourism, and Agricultural Productivity as Drivers of Environmental Degradation: Testing the EKC Hypothesis in ASEAN Countries

Author

Listed:
  • Yuldoshboy Sobirov

    (Department of Accounting, Mamun University, Urgench 220100, Uzbekistan)

  • Beruniy Artikov

    (Department of Accounting, Mamun University, Urgench 220100, Uzbekistan)

  • Elbek Khodjaniyozov

    (Department of Business and Management, Urgench State University named after Abu Rayhan Beruni, Urgench 220100, Uzbekistan)

  • Peter Marty

    (Institute of Natural Resource Sciences, Zurich University of Applied Sciences (ZHAW), 8820 Wädenswil, Switzerland)

  • Olimjon Saidmamatov

    (Faculty of Socio-Economic Sciences, Urgench State University, Urgench 220100, Uzbekistan)

Abstract

This study examines the long-run relationship between carbon dioxide (CO 2 ) emissions and key macroeconomic and sectoral drivers in ten ASEAN economies from 1995 to 2023. Employing Driscoll–Kraay standard errors, Prais–Winsten regression, heteroskedastic panel-corrected standard errors, Fully Modified Ordinary Least Squares (FMOLS), Dynamic Ordinary Least Squares (DOLS), and Canonical Cointegrating Regression (CCR) estimators, the analysis accounts for cross-sectional dependence, slope heterogeneity, and endogeneity. Results indicate that GDP exerts a more-than-unitary positive effect on emissions, with a negative GDP-squared term supporting the Environmental Kuznets Curve. Agriculture raises emissions through land-use change and high-emission cultivation practices, while tourism shows a negative association likely reflecting territorial accounting effects. Trade openness increases emissions, highlighting the carbon intensity of export structures, whereas foreign direct investment exerts no significant net effect. These results suggest that ASEAN economies must accelerate renewable energy adoption, promote climate-smart agriculture, embed enforceable environmental provisions in trade policy, and implement rigorous sustainability screening for FDI to achieve low-carbon growth trajectories.

Suggested Citation

  • Yuldoshboy Sobirov & Beruniy Artikov & Elbek Khodjaniyozov & Peter Marty & Olimjon Saidmamatov, 2025. "Economic Growth, FDI, Tourism, and Agricultural Productivity as Drivers of Environmental Degradation: Testing the EKC Hypothesis in ASEAN Countries," Sustainability, MDPI, vol. 17(18), pages 1-24, September.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:18:p:8394-:d:1753014
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/18/8394/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/17/18/8394/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Peter C. B. Phillips & Bruce E. Hansen, 1990. "Statistical Inference in Instrumental Variables Regression with I(1) Processes," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 57(1), pages 99-125.
    2. Robert J. R. Elliott & Kenichi Shimamoto, 2008. "Are ASEAN Countries Havens for Japanese Pollution‐Intensive Industry?," The World Economy, Wiley Blackwell, vol. 31(2), pages 236-254, February.
    3. Jamil, Faisal & Ahmad, Eatzaz, 2010. "The relationship between electricity consumption, electricity prices and GDP in Pakistan," Energy Policy, Elsevier, vol. 38(10), pages 6016-6025, October.
    4. Grossman, G.M & Krueger, A.B., 1991. "Environmental Impacts of a North American Free Trade Agreement," Papers 158, Princeton, Woodrow Wilson School - Public and International Affairs.
    5. M. Hashem Pesaran, 2007. "A simple panel unit root test in the presence of cross-section dependence," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(2), pages 265-312.
    6. Manfred Lenzen & Ya-Yen Sun & Futu Faturay & Yuan-Peng Ting & Arne Geschke & Arunima Malik, 2018. "The carbon footprint of global tourism," Nature Climate Change, Nature, vol. 8(6), pages 522-528, June.
    7. Bernard, Vl, 1987. "Cross-Sectional Dependence And Problems In Inference In Market-Based Accounting Research," Journal of Accounting Research, John Wiley & Sons, Ltd., vol. 25(1), pages 1-48.
    8. Thi Anh-Dao Tran & Sy-Hoa Ho & Thanh Tam Nguyen-Huu, 2025. "The Role of CO2 Emission and Foreign Direct Investment in ASEAN’s Trade Patterns," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 16(2), pages 8807-8839, June.
    9. John C. Driscoll & Aart C. Kraay, 1998. "Consistent Covariance Matrix Estimation With Spatially Dependent Panel Data," The Review of Economics and Statistics, MIT Press, vol. 80(4), pages 549-560, November.
    10. Reza Sherafatian-Jahromi & Mohd Shahwahid Othman & Siong Hook Law & Normaz Wana Ismail, 2017. "Tourism and CO2 emissions nexus in Southeast Asia: new evidence from panel estimation," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 19(4), pages 1407-1423, August.
    11. Yehyun An & Minjee Kim, 2022. "The Current State of Territorial Development of ASEAN Countries and Strategic Types for Balanced Development," Sustainability, MDPI, vol. 14(19), pages 1-28, October.
    12. Daniel Hoechle, 2007. "Robust standard errors for panel regressions with cross-sectional dependence," Stata Journal, StataCorp LLC, vol. 7(3), pages 281-312, September.
    13. Olatunji A. Shobande & Lawrence Ogbeifun & Aviral Kumar Tiwari, 2025. "Do Structural Transformation and Energy Transition Cause Growth?," Review of Development Economics, Wiley Blackwell, vol. 29(4), pages 2710-2735, November.
    14. Silvia Coderoni & Roberto Esposti, 2014. "Is There a Long-Term Relationship Between Agricultural GHG Emissions and Productivity Growth? A Dynamic Panel Data Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 58(2), pages 273-302, June.
    15. Bo Shao & Liang Zhang & Syed Ahsan Ali Shah, 2025. "Barriers and Opportunities in Implementing Carbon Neutrality Goals in China’s Heavy Industries," Sustainability, MDPI, vol. 17(2), pages 1-25, January.
    16. Nguyen, Canh Phuc & Le, Thai-Ha & Schinckus, Christophe & Su, Thanh Dinh, 2021. "Determinants of agricultural emissions: panel data evidence from a global sample," Environment and Development Economics, Cambridge University Press, vol. 26(2), pages 109-130, April.
    17. Al-Mulali, Usama & Saboori, Behnaz & Ozturk, Ilhan, 2015. "Investigating the environmental Kuznets curve hypothesis in Vietnam," Energy Policy, Elsevier, vol. 76(C), pages 123-131.
    18. Breusch, T S & Pagan, A R, 1979. "A Simple Test for Heteroscedasticity and Random Coefficient Variation," Econometrica, Econometric Society, vol. 47(5), pages 1287-1294, September.
    19. S. de Silva & K. Hadri & A. R. Tremayne, 2009. "Panel unit root tests in the presence of cross-sectional dependence: finite sample performance and an application," Econometrics Journal, Royal Economic Society, vol. 12(2), pages 340-366, July.
    20. Lars J. Nilsson & Fredric Bauer & Max Åhman & Fredrik N. G. Andersson & Chris Bataille & Stephane de la Rue du Can & Karin Ericsson & Teis Hansen & Bengt Johansson & Stefan Lechtenböhmer & Mariësse va, 2021. "An industrial policy framework for transforming energy and emissions intensive industries towards zero emissions," Climate Policy, Taylor & Francis Journals, vol. 21(8), pages 1053-1065, September.
    21. Abdulla Ahmed Al-Mohannadi & Kadir Ertogral & Murat Erkoc, 2024. "Alternative Fuels in Sustainable Logistics—Applications, Challenges, and Solutions," Sustainability, MDPI, vol. 16(19), pages 1-42, September.
    22. Begum, Rawshan Ara & Sohag, Kazi & Abdullah, Sharifah Mastura Syed & Jaafar, Mokhtar, 2015. "CO2 emissions, energy consumption, economic and population growth in Malaysia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 41(C), pages 594-601.
    23. Manfred Lenzen & Ya-Yen Sun & Futu Faturay & Yuan-Peng Ting & Arne Geschke & Arunima Malik, 2018. "Author Correction: The carbon footprint of global tourism," Nature Climate Change, Nature, vol. 8(6), pages 544-544, June.
    24. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
    25. Park, Rolla Edward & Mitchell, Bridger M., 1980. "Estimating the autocorrelated error model with trended data," Journal of Econometrics, Elsevier, vol. 13(2), pages 185-201, June.
    Full references (including those not matched with items on IDEAS)

    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. Ali, Qamar & Yaseen, Muhammad Rizwan & Anwar, Sofia & Makhdum, Muhammad Sohail Amjad & Khan, Muhammad Tariq Iqbal, 2021. "The impact of tourism, renewable energy, and economic growth on ecological footprint and natural resources: A panel data analysis," Resources Policy, Elsevier, vol. 74(C).
    2. Omri, Anis, 2018. "Entrepreneurship, sectoral outputs and environmental improvement: International evidence," Technological Forecasting and Social Change, Elsevier, vol. 128(C), pages 46-55.
    3. Muhammed Ashiq Villanthenkodath & Mohd Arshad Ansari & Muhammad Shahbaz & Xuan Vinh Vo, 2022. "Do tourism development and structural change promote environmental quality? Evidence from India," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(4), pages 5163-5194, April.
    4. Caravaggio, Nicola, 2020. "A global empirical re-assessment of the Environmental Kuznets curve for deforestation," Forest Policy and Economics, Elsevier, vol. 119(C).
    5. Fredrick Oteng Agyeman & Ma Zhiqiang & Mingxing Li & Agyemang Kwasi Sampene & Malcom Frimpong Dapaah & Emmanuel Adu Gyamfi Kedjanyi & Paul Buabeng & Yiyao Li & Saifullah Hakro & Mohammad Heydari, 2022. "Probing the Effect of Governance of Tourism Development, Economic Growth, and Foreign Direct Investment on Carbon Dioxide Emissions in Africa: The African Experience," Energies, MDPI, vol. 15(13), pages 1-24, June.
    6. Leal, Patrícia Hipólito & Marques, António Cardoso, 2020. "Rediscovering the EKC hypothesis for the 20 highest CO2 emitters among OECD countries by level of globalization," International Economics, Elsevier, vol. 164(C), pages 36-47.
    7. Kostakis, Ioannis & Arauzo-Carod, Josep-Maria, 2023. "The key roles of renewable energy and economic growth in disaggregated environmental degradation: Evidence from highly developed, heterogeneous and cross-correlated countries," Renewable Energy, Elsevier, vol. 206(C), pages 1315-1325.
    8. George Halkos & George Ekonomou, 2023. "Can Business and Leisure Tourism Spending Lead to Lower Environmental Degradation Levels? Research on the Eurozone Economic Space," Sustainability, MDPI, vol. 15(7), pages 1-16, March.
    9. Patrícia Hipólito Leal & António Cardoso Marques & Muhammad Shahbaz, 2021. "The role of globalisation, de jure and de facto, on environmental performance: evidence from developing and developed countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(5), pages 7412-7431, May.
    10. Brantley Liddle & Fakhri Hasanov, 2022. "Industry electricity price and output elasticities for high-income and middle-income countries," Empirical Economics, Springer, vol. 62(3), pages 1293-1319, March.
    11. Skare, Marinko & Gavurova, Beata & Sinkovic, Dean, 2023. "Regional aspects of financial development and renewable energy: A cross-sectional study in 214 countries," Economic Analysis and Policy, Elsevier, vol. 78(C), pages 1142-1157.
    12. Chukwuemeka Chinonso Emenekwe & Robert Ugochukwu Onyeneke & Chinedum Uzoma Nwajiuba & Ifeoma Quinette Anugwa & Obioma Uchenna Emenekwe, 2025. "Determinants of consumption-based and production-based carbon emissions," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 27(5), pages 10303-10339, May.
    13. Ansari, Mohd Arshad, 2022. "Re-visiting the Environmental Kuznets curve for ASEAN: A comparison between ecological footprint and carbon dioxide emissions," Renewable and Sustainable Energy Reviews, Elsevier, vol. 168(C).
    14. Jos Alberto Fuinhas & Ant nio Cardoso Marques & Alcino Pinto Couto, 2015. "Oil-Growth Nexus in Oil Producing Countries: Macro Panel Evidence," International Journal of Energy Economics and Policy, Econjournals, vol. 5(1), pages 148-163.
    15. Shreya Pal, 2024. "The International Capital Flows and Domestic Savings–domestic Investment Nexus: A Comparative Evidence Between Heterogeneous Developing Regions," South Asian Journal of Macroeconomics and Public Finance, , vol. 13(2), pages 169-212, December.
    16. Myo Myo Htike & Anil Shrestha & Makoto Kakinaka, 2022. "Investigating whether the environmental Kuznets curve hypothesis holds for sectoral CO2 emissions: evidence from developed and developing countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(11), pages 12712-12739, November.
    17. Manu Sharma & Geetilaxmi Mohapatra & Arun Kumar Giri & Albert Wijeweera & Clevo Wilson, 2025. "Examining the tourism-induced environmental Kuznets curve hypothesis for India," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 27(4), pages 9107-9126, April.
    18. Mohammad Naim Azimi & Mohammad Mafizur Rahman, 2024. "Examining the environmental Phillips curve hypothesis in G7 nations: critical insights from wavelet coherence and wavelet causality analysis," Quality & Quantity: International Journal of Methodology, Springer, vol. 58(6), pages 5683-5713, December.
    19. Rafaela Vital Caetano & António Cardoso Marques, 2024. "Nonlinear relationships between Foreign Direct Investment decisions and environmental degradation in high- and middle-income countries," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 51(1), pages 135-188, March.
    20. Angeliki N. Menegaki, 2019. "The ARDL Method in the Energy-Growth Nexus Field; Best Implementation Strategies," Economies, MDPI, vol. 7(4), pages 1-16, October.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;
    ;

    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:gam:jsusta:v:17:y:2025:i:18:p:8394-:d:1753014. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.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.