IDEAS home Printed from https://ideas.repec.org/a/wly/sustdv/v32y2024i1p755-776.html
   My bibliography  Save this article

The impact of globalization on the decoupling of water consumption and economic growth in BRICS and N11 countries—Linear and nonlinear approaches

Author

Listed:
  • Qiang Wang
  • Xiaowei Wang
  • Rongrong Li

Abstract

In the context of globalization, the 2030 sustainable development goals pose a huge challenge to the coordinated development of economy and environment in emerging economies. The purpose of this article is to investigate whether globalization contributes to balance water consumption and economic growth in emerging economies. China is the largest developing country and the largest trader of goods in the world. From holistic and representative perspectives, this article analyzes the mechanisms affecting economic growth and water consumption in BRICS countries, Next Eleven (N11) countries and China. Combining decoupling model and econometric models, fully modified ordinary least squares (FMOLS) linear model and threshold panel nonlinear model are constructed. Both linear and nonlinear effects of trade and foreign investment on economic growth and water consumption are considered. The results show that, from a holistic perspective, globalization helps balance economic growth and water consumption in emerging economies. The impact of trade on water consumption in BRICS countries is negative. And with the increase of trade, its positive coefficient on water consumption in N11 countries gradually decreases. Foreign direct investment (FDI) plays a positive role in the coordinated development of economic growth and water environment in BRICS and N11 countries. Taking China as a representative country, there is a decoupling phenomenon between economic growth and water use during the study period. With the trade crossing the threshold successively, the promoting effect on economy increases first and then decreases, and the inhibiting effect on water consumption weakens. With the increase of foreign investment, its positive effect on GDP increases, and its positive coefficient on water consumption decreases. The conclusions from representative country and holistic perspective are consistent. Finally, some policy recommendations are put forward.

Suggested Citation

  • Qiang Wang & Xiaowei Wang & Rongrong Li, 2024. "The impact of globalization on the decoupling of water consumption and economic growth in BRICS and N11 countries—Linear and nonlinear approaches," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(1), pages 755-776, February.
    • Handle: RePEc:wly:sustdv:v:32:y:2024:i:1:p:755-776
    DOI: 10.1002/sd.2696
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/sd.2696
    Download Restriction: no
    File URL: https://libkey.io/10.1002/sd.2696?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
    ---><---

    References listed on IDEAS

    as
    1. Zuocheng Chen & Krishna P. Paudel & Rongqing Zheng, 2022. "Pollution halo or pollution haven: assessing the role of foreign direct investment on energy conservation and emission reduction," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 65(2), pages 311-336, January.
    2. Lin, Boqiang & Li, Zheng, 2020. "Is more use of electricity leading to less carbon emission growth? An analysis with a panel threshold model," Energy Policy, Elsevier, vol. 137(C).
    3. Kashif Iqbal & Muddassar Sarfraz & Khurshid, 2023. "Exploring the role of information communication technology, trade, and foreign direct investment to promote sustainable economic growth: Evidence from Belt and Road Initiative economies," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(3), pages 1526-1535, June.
    4. Kong, Qunxi & Peng, Dan & Ni, Yehui & Jiang, Xinyue & Wang, Ziqi, 2021. "Trade openness and economic growth quality of China: Empirical analysis using ARDL model," Finance Research Letters, Elsevier, vol. 38(C).
    5. Chen, Jiandong & Wang, Ping & Cui, Lianbiao & Huang, Shuo & Song, Malin, 2018. "Decomposition and decoupling analysis of CO2 emissions in OECD," Applied Energy, Elsevier, vol. 231(C), pages 937-950.
    6. Ren, Siyu & Hao, Yu & Wu, Haitao, 2022. "The role of outward foreign direct investment (OFDI) on green total factor energy efficiency: Does institutional quality matters? Evidence from China," Resources Policy, Elsevier, vol. 76(C).
    7. Najabat Ali & Khamphe Phoungthong & Kuaanan Techato & Waheed Ali & Shah Abbas & Joshuva Arockia Dhanraj & Anwar Khan, 2022. "FDI, Green Innovation and Environmental Quality Nexus: New Insights from BRICS Economies," Sustainability, MDPI, vol. 14(4), pages 1-17, February.
    8. Im, Kyung So & Pesaran, M. Hashem & Shin, Yongcheol, 2003. "Testing for unit roots in heterogeneous panels," Journal of Econometrics, Elsevier, vol. 115(1), pages 53-74, July.
    9. Syed Abdul Rehman Khan & Arshian Sharif & Hêriş Golpîra & Anil Kumar, 2019. "A green ideology in Asian emerging economies: From environmental policy and sustainable development," Sustainable Development, John Wiley & Sons, Ltd., vol. 27(6), pages 1063-1075, November.
    10. Ikram Jebabli & Amine Lahiani & Salma Mefteh-Wali, 2023. "Quantile connectedness between CO2 emissions and economic growth in G7 countries," Post-Print hal-04353000, HAL.
    11. Wu, Haitao & Xu, Lina & Ren, Siyu & Hao, Yu & Yan, Guoyao, 2020. "How do energy consumption and environmental regulation affect carbon emissions in China? New evidence from a dynamic threshold panel model," Resources Policy, Elsevier, vol. 67(C).
    12. Awan, Ashar & Abbasi, Kashif Raza & Rej, Soumen & Bandyopadhyay, Arunava & Lv, Kangjuan, 2022. "The impact of renewable energy, internet use and foreign direct investment on carbon dioxide emissions: A method of moments quantile analysis," Renewable Energy, Elsevier, vol. 189(C), pages 454-466.
    13. Jason Russ & Esha Zaveri & Sebastien Desbureaux & Richard Damania & Aude Sophie Rodella, 2022. "The impact of water quality on GDP growth: Evidence from around the world," Post-Print hal-03920974, HAL.
    14. Atif Jahanger & Muhammad Usman & Daniel Balsalobre‐Lorente, 2022. "Linking institutional quality to environmental sustainability," Sustainable Development, John Wiley & Sons, Ltd., vol. 30(6), pages 1749-1765, December.
    15. Pata, Ugur Korkut, 2021. "Linking renewable energy, globalization, agriculture, CO2 emissions and ecological footprint in BRIC countries: A sustainability perspective," Renewable Energy, Elsevier, vol. 173(C), pages 197-208.
    16. Bakry, Walid & Nghiem, Xuan-Hoa & Farouk, Sherine & Vo, Xuan Vinh, 2023. "Does it hurt or help? Revisiting the effects of ICT on economic growth and energy consumption: A nonlinear panel ARDL approach," Economic Analysis and Policy, Elsevier, vol. 78(C), pages 597-617.
    17. Montoya, Marco Antonio & Allegretti, Gabriela & Bertussi, Luís Antônio Sleimann & Talamini, Edson, 2023. "Domestic and foreign decoupling of economic growth and water consumption and its driving factors in the Brazilian economy," Ecological Economics, Elsevier, vol. 206(C).
    18. Ritu Rana & Manoj Sharma, 2019. "Dynamic causality testing for EKC hypothesis, pollution haven hypothesis and international trade in India," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 28(3), pages 348-364, April.
    19. Saba, Charles Shaaba, 2023. "Nexus between CO2 emissions, renewable energy consumption, militarisation, and economic growth in South Africa: Evidence from using novel dynamic ARDL simulations," Renewable Energy, Elsevier, vol. 205(C), pages 349-365.
    20. Wang, Zhaohua & Pham, Thi Le Hoa & Sun, Kaining & Wang, Bo & Bui, Quocviet & Hashemizadeh, Ali, 2022. "The moderating role of financial development in the renewable energy consumption - CO2 emissions linkage: The case study of Next-11 countries," Energy, Elsevier, vol. 254(PB).
    21. Muhammad, Sulaman & Long, Xingle & Salman, Muhammad & Dauda, Lamini, 2020. "Effect of urbanization and international trade on CO2 emissions across 65 belt and road initiative countries," Energy, Elsevier, vol. 196(C).
    22. Jebabli, Ikram & Lahiani, Amine & Mefteh-Wali, Salma, 2023. "Quantile connectedness between CO2 emissions and economic growth in G7 countries," Resources Policy, Elsevier, vol. 81(C).
    23. Arshian Sharif & Najia Saqib & Kangyin Dong & Syed Abdul Rehman Khan, 2022. "Nexus between green technology innovation, green financing, and CO2 emissions in the G7 countries: The moderating role of social globalisation," Sustainable Development, John Wiley & Sons, Ltd., vol. 30(6), pages 1934-1946, December.
    24. Sadam Hussain & Waqar Ahmad & Yasmeen Qamar & Muhammad Shahid Akram, 2019. "Impact of Inflation, CO2 Emissions and Foreign Investment on Economic Growth: A Case of Pakistan," Asian Development Policy Review, Asian Economic and Social Society, vol. 7(4), pages 307-317, December.
    25. Abdullah Emre Caglar & Bulent Guloglu & Ayfer Gedikli, 2022. "Moving towards sustainable environmental development for BRICS: Investigating the asymmetric effect of natural resources on CO2," Sustainable Development, John Wiley & Sons, Ltd., vol. 30(5), pages 1313-1325, October.
    26. Zhang, Yu & Zhang, Sufang, 2018. "The impacts of GDP, trade structure, exchange rate and FDI inflows on China's carbon emissions," Energy Policy, Elsevier, vol. 120(C), pages 347-353.
    27. Sadam Hussain & Waqar Ahmad & Yasmeen Qamar & Muhammad Shahid Akram, 2019. "Impact of Inflation, CO2 Emissions and Foreign Investment on Economic Growth: A Case of Pakistan," Asian Development Policy Review, Asian Economic and Social Society, vol. 7(4), pages 307-317.
    28. Liu, Fengqi & Kang, Yuxin & Guo, Kun, 2022. "Is electricity consumption of Chinese counties decoupled from carbon emissions? A study based on Tapio decoupling index," Energy, Elsevier, vol. 251(C).
    29. Baskaran Venkatesh & R Velkennedy, 2023. "Formulation of citizen science approach for monitoring Sustainable Development Goal 6: Clean water and sanitation for an Indian city," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(1), pages 56-66, February.
    30. Song, Yan & Sun, Junjie & Zhang, Ming & Su, Bin, 2020. "Using the Tapio-Z decoupling model to evaluate the decoupling status of China's CO2 emissions at provincial level and its dynamic trend," Structural Change and Economic Dynamics, Elsevier, vol. 52(C), pages 120-129.
    31. Fan, Weiyang & Hao, Yu, 2020. "An empirical research on the relationship amongst renewable energy consumption, economic growth and foreign direct investment in China," Renewable Energy, Elsevier, vol. 146(C), pages 598-609.
    32. 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.
    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. Maria Molinos‐Senante & Alexandros Maziotis, 2025. "The Influence of Environmental Variables on the Carbon Performance of Water Companies Across Time," Sustainable Development, John Wiley & Sons, Ltd., vol. 33(3), pages 4718-4731, June.
    2. Asif Ali & Jinkai Li & Jin Zhang & Muhammad Zubair Chishti, 2024. "Exploring the impact of green finance and technological innovation on green economic growth: Evidence from emerging market economies," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(6), pages 6392-6407, December.

    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. Nguyen, Thi Hao & Deng, Hongbing & Abbas, Zainab Zahra & Lam, Thi Thoa & Abbas, Hussain Raza, 2024. "The effect of natural capital, regional development, FDI, and natural resource rent on environmental performance: The Mediating role of green innovation," Resources Policy, Elsevier, vol. 91(C).
    2. Mehmet Balcilar & Ojonugwa Usman & George N. Ike, 2023. "Investing green for sustainable development without ditching economic growth," Sustainable Development, John Wiley & Sons, Ltd., vol. 31(2), pages 728-743, April.
    3. Ma, Qiang & Li, Sa & Aslam, Misbah & Ali, Naveed & Alamri, Ahmad Mohammed, 2023. "Extraction of natural resources and sustainable renewable energy: COP26 target in the context of financial inclusion," Resources Policy, Elsevier, vol. 82(C).
    4. Mustafa Kamal & Muhammad Usman & Atif Jahanger & Daniel Balsalobre-Lorente, 2021. "Revisiting the Role of Fiscal Policy, Financial Development, and Foreign Direct Investment in Reducing Environmental Pollution during Globalization Mode: Evidence from Linear and Nonlinear Panel Data ," Energies, MDPI, vol. 14(21), pages 1-25, October.
    5. Balsalobre-Lorente, Daniel & Contente dos Santos Parente, Clara & Leitão, Nuno Carlos & Cantos-Cantos, José María, 2023. "The influence of economic complexity processes and renewable energy on CO2 emissions of BRICS. What about industry 4.0?," Resources Policy, Elsevier, vol. 82(C).
    6. Lobna Abid & Sana Kacem & Haifa Saadaoui, 2024. "Addressing the Environmental Kuznets Curve in the West African Countries: Exploring the Roles of FDI, Corruption, and Renewable Energy," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(4), pages 20491-20515, December.
    7. Nabil Maalel, 2024. "Renewable Energy Transition, Trade Openness, and CO2 Emissions Nexus in the Middle East," International Journal of Energy Economics and Policy, Econjournals, vol. 14(3), pages 434-441, May.
    8. Bui Huy Nhuong & Ho Dinh Bao & Le Thanh Ha, 2024. "Embracing Green Foreign Direct Investment in a Journey toward Global Sustainable Economy: An Empirical Approach Using Statistical Analysis," International Journal of Energy Economics and Policy, Econjournals, vol. 14(5), pages 435-446, September.
    9. Faik Bilgili & Daniel Balsalobre-Lorente & Sevda Kuşkaya & Mohammed Alnour & Seyit Önderol & Mohammad Enamul Hoque, 2024. "Are research and development on energy efficiency and energy sources effective in the level of CO2 emissions? Fresh evidence from EU data," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(9), pages 24183-24219, September.
    10. Wilman-Santiago Ochoa-Moreno & Byron Alejandro Quito & Carlos Andrés Moreno-Hurtado, 2021. "Foreign Direct Investment and Environmental Quality: Revisiting the EKC in Latin American Countries," Sustainability, MDPI, vol. 13(22), pages 1-18, November.
    11. Saqib, Najia & Ozturk, Ilhan & Sharif, Arshian & Cichoń, Dariusz, 2024. "Enhancing sustainable energy: Mineral exports, financial development, and foreign investment can build a greener future?," Resources Policy, Elsevier, vol. 97(C).
    12. Marc Audi & Amjad Ali, 2023. "Public Policy and Economic Misery Nexus: A Comparative Analysis of Developed and Developing World," International Journal of Economics and Financial Issues, Econjournals, vol. 13(3), pages 56-73, May.
    13. Yang Yu & Yiming Du, 2025. "Does ICT change the relationship between trade openness and CO2 emissions? Evidence for RCEP countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 27(1), pages 857-879, January.
    14. Daberechi Chikezie Ekwueme & Taiwo Temitope Lasisi & Kayode Kolawole Eluwole, 2023. "Environmental sustainability in Asian countries: Understanding the criticality of economic growth, industrialization, tourism import, and energy use," Energy & Environment, , vol. 34(5), pages 1592-1618, August.
    15. Ibrahiem, Dalia M. & Hanafy, Shaimaa A., 2021. "Do energy security and environmental quality contribute to renewable energy? The role of trade openness and energy use in North African countries," Renewable Energy, Elsevier, vol. 179(C), pages 667-678.
    16. Yang, Shuangpeng & umar, Muhammad, 2022. "How globalization is reshaping the environmental quality in G7 economies in the presence of renewable energy initiatives?," Renewable Energy, Elsevier, vol. 193(C), pages 128-135.
    17. 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.
    18. Kashif Raza Abbasi & Festus Fatai Adedoyin & Magdalena Radulescu & Khadim Hussain & Sultan Salem, 2022. "The role of forest and agriculture towards environmental fortification: designing a sustainable policy framework for top forested countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(6), pages 8639-8666, June.
    19. Qiang Wang & Xiaowei Wang & Rongrong Li & Xueting Jiang, 2024. "Reinvestigating the environmental Kuznets curve (EKC) of carbon emissions and ecological footprint in 147 countries: a matter of trade protectionism," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-17, December.
    20. Zhang, Qianxiao & Shah, Syed Ale Raza & Yang, Ling, 2022. "An Appreciated Response of Disaggregated Energies Consumption towards the Sustainable Growth: A debate on G-10 Economies," Energy, Elsevier, vol. 254(PA).

    More about this item

    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:wly:sustdv:v:32:y:2024:i:1:p:755-776. 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: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1099-1719 .

    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.