An Econometric Analysis of the Causes of Environmental Degradation in Developing Countries

Abstract

Globally, efforts are being made to achieve ecological sustainability while reducing pollution's environmental impact. This study aims to analyze the links between many variables, such as GDP growth, green finance, consumption of renewable energy, natural resource rent, technological innovation in the energy sector, urbanization, and pollution, using panel data spanning 1998 to 2021. This investigation used an innovative approach to econometrics known as CS-ARDL to investigate the short-term and long-term relationships between the series. According to the results, economic growth, the monetization of natural resources, and urbanization all lead to pollution. The findings of this study, on the other hand, demonstrated that encouraging energy innovation, green funding, and using renewable energy are all realistic strategies for reducing the number of pollutants released into the environment. This study contributes to the existing body of research by examining the factors that lead to environmental pollution from the point of view of ASEAN economies. This research is a reference for governments and policymakers when selecting how much money to invest in environmentally friendly technologies to extract natural resources from these countries to have a less negative environmental effect.