Nonlinear effects of urbanization routes (proportion of small cities, and proportion of large cities) on environmental degradation, evidence from China, India, Indonesia, the United States, and Brazil

The dynamic stochastic effects regressions on population, affluence, and technology model used in this study reveals the nonlinear effects of urbanization routes on CO 2 emissions in China, India, Indonesia, the United States, and Brazil during 1970–2020, using dynamic seemingly unrelated regression, dynamic ordinary least square, and fully modified ordinary least square techniques. The empirical analysis shows that urbanization and the proportion of small cities contribute significantly to CO 2 emissions, while the square of urbanization and the square of the proportion of small cities significantly reduce CO 2 emissions, thus supporting the inverted U-shaped relationship for the selected countries. However, the effect of the proportion of large cities significantly reduces CO 2 emissions, while the square of the proportion of large cities significantly promotes CO 2 emissions, supporting a U-shaped relationship for specific countries. Gross domestic product, industrial development, and transport infrastructure contribute significantly to carbon emissions, while renewable energy generation significantly reduces carbon emissions. The country-level augmented mean group estimator in the analysis supports an inverted U-shaped relationship between urbanization and carbon emissions and a U-shaped relationship between the proportion of large cities and carbon emissions in all selected countries. There is also an inverted U-shaped relationship between the proportion of small cities and carbon emissions in China, India, Indonesia, and Brazil. The causality test results acknowledge bidirectional causality between urbanization and carbon dioxide emissions; between urbanization squared and carbon dioxide emissions; between the proportion of the largest cities and carbon dioxide emissions, and between renewable energy and carbon dioxide emissions. This study recommends renewable energy options, green urban infrastructure, and digital technologies to improve the environmental quality of urban areas.