Assessing the Impact of Technological Innovations and Trade Openness on Environmental Sustainability: An Empirical Study of South Asian Economies Using Panel ARDL Approach
DOI:
https://doi.org/10.61506/Keywords:
Technological Innovation, Trade Openness, Environmental Sustainability, Economic growth and South Asian EconomiesAbstract
This study examines the major factors that influence environmental sustainability over a 20-year period (2000–2020) in the four South Asian economies. In this study, two methods of estimation including the Pool Mean Group (PMG) estimator and the panel autoregressive distributed lag (ARDL) approach are used. The findings explore that trade openness, energy consumption, and economic expansion have a long-term positive and considerable impact on environmental deterioration, conversely technical innovation has a long-term negative impact on the environment. In short run scenario, trade openness and energy usage have significant and favourable effects on environmental degradation, whereas the economic growth and technological advancement have had a substantial negative influence on the environment. From this study, the policy makers provide the direction to the government by incentivizing technology, enforcing energy-efficient laws, promoting renewable energy, aligning trade policies with environmental goals, and enhancing regional cooperation. In order to improve South Asian environmental sustainable policies, future research should examine energy-trade-growth-technology by employing advanced techniques, and prioritizing innovation.
References
Abro, A. A., Abubakar, M., Shahid, T. A., & Fatima, U. (2024). Does Volatility Spillover among Sectors Varies from Normal to Turbulent Periods ? Evidence from Pakistan Stock Exchange. Pakistan Journal of Humanities and Social Sciences Volume, 12(02), 1174–1187.
Adeel, F. R. M., Abu Bakar, N.A., & Olajide Raji, J. (2018). Green field investment and environmental performance: A case of selected nine developing countries of Asia. Environmental Progress & Sustainable Energy, 37 (3), 1085-1092.
Adeleye, B.N., Akam, D., Inuwa, N. et al. (2023). Does globalization and energy usage influence carbon emissions in South Asia? An empirical revisit of the debate. Environmental Science Pollution Research, 30- 36, 190–36207.
Al-mulali, U. (2012). Factors affecting CO2 emission in the Middle East: A panel data analysis. Energy, 44(1), 564-569.
Álvarez-Herránz, A., Balsalobre, D., Cantos, J. M., & Shahbaz, M. (2017). Energy innovations-GHG emissions nexus: Fresh empirical evidence from OECD countries. Energy Policy, 101, 90–100.
Ashiq, S., Ali, A., Siddique, H. A., Sumaira, (2023). Impact of Innovation on CO2 Emissions in South Asian Countries. Bulletin of Business and Economics,12(2), 201-211.
Aslam, B., Hu, J., Shahab, S., Ahmad, A., Saleem, M., Shah, S. S. A., Hassan, M. (2021). The nexus of industrialization, GDP per capita and CO2 emission in China. Environmental Technology & Innovation, 23, 101674.
Audi, M., Poulin, M., & Ali, A. (2024). Environmental impact of business freedom and renewable energy: a global perspective. International Journal of Energy Economics and Policy, 14(3), 672-683.
Azhar, S., & Marimuthu, K. N. (2012). An overview of Foreign Direct Investment in India. ZENITH International Journal of Business Economics & Management Research, 2(1), 8826.
Cansino Muñoz-Repiso, J. M., Román Collado, R., & Molina Gaitán, J. C. (2019). Quality of institutions, technological progress, and pollution havens in latin America. An analysis of the environmental kuznets curve hypothesis. Sustainability, 11(13), 3708.
Chen H, Tackie EA, Ahakwa I, Musah M, Salakpi A, Alfred M, Atingabili S (2022) Does energy consumption, economic growth, urbanization, and population growth influence carbon emissions in the BRICS? Evidence from panel models robust to cross-sectional dependence and slope heterogeneity. Environ Sci Pollut Res.
Du, J.-G., Oh, K., Han, I., Long, X., Chen, Y., & Du, J. (2017). Environmental innovation and its impact on economic and environmental performance: Evidence from Korean-owned firms in China. Elsevier.
Ertugrul, H. M., Cetin, M., Seker, F., & Dogan, E. (2016). The impact of trade openness on global carbon dioxide emissions: Evidence from the top ten emitters among developing countries. Ecological Indicators, 67, 543–555.
Farhadi, M., & Zhao, L. (2024). Exploring the Impact of Iran-China Trade on Environmental Sustainability. Journal of Energy and Environmental Policy Options, 7(1), 1-8.
Harrathi, N., & Almohaimeed, A. (2022). Determinants of Carbon Dioxide Emissions: New Empirical Evidence from MENA Countries. International Journal of Energy Economics and Policy, 12(1), 469-482.
Hashmi, S. M., Bhowmik, R., Inglesi-Lotz, R., & Syed, Q. R. (2022). Investigating the Environmental Kuznets Curve hypothesis amidst geopolitical risk: Global evidence using bootstrap ARDL approach. Environmental Science and Pollution Research, 29(16), 24049–24062.
Hashmi, S.M. Bhowmik, R., Inglesi-Lotz, R., & Syed, Q.R. (2022). Investigating the Environmental Kuznets Curve hypothesis amidst geopolitical risk: Global evidence using bootstrap ARDL approach. Environmental Science and Pollution Research, 29(16), 24049-24062.
Hodson, E.L., Brown, M., Cleary, K., Cohen, S., Showalter, S., Wise, M., Wood, F. (2018). US energy sector impacts of technology innovation, fuel price, and electric sector CO2 policy: results from the EMF 32 model intercomparison study. Energy Econ 73, 352–370
Huang, S.Z., Sadiq, M., Chien, F. (2021). Dynamic nexus between transportation, urbanization, economic growth and environmental pollution in ASEAN countries: does environmental regulations matter? Environ Sci Pollut Res.
Huang, Y., Rahman, S. U., Meo, M. S., Ali, M. S. E., & Khan, S. (2024). Revisiting the environmental Kuznets curve: assessing the impact of climate policy uncertainty in the Belt and Road Initiative. Environmental Science and Pollution Research, 31(7), 10579–10593.
Hussain, J., Zhou, K., Guo, S., & Khan, A. (2020). Investment risk and natural resource potential in Belt & Road Initiative countries: A multi-criteria decision-making approach. Science of the Total Environment, 723, 137981.
Jiang, R., & Liu, B. (2023). How to achieve carbon neutrality while maintaining economic vitality: An exploration from the perspective of technological innovation and trade openness. Science of the Total Environment, 868, 161490.
Jiang, R., & Liu, B. (2023). How to achieve carbon neutrality while maintaining economic vitality: An exploration from the perspective of technological innovation and trade openness. Science of The Total Environment, 868, 161490.
Khan, M.T.I., Yaseen, M.R., Ali, Q. (2017). Dynamic relationship between financial development, energy consumption, trade and greenhouse gas: comparison of upper middle income countries from Asia, Europe, Africa and America. J Clean Prod 161:567–580
Kiani, T. A., Sabir, S., Qayyum, U., & Anjum, S. (2023). Estimating the effect of technological innovations on environmental degradation: empirical evidence from selected ASEAN and SAARC countries. Environment, Development and Sustainability, 25(7), 6529-6550.
Kiani, T. A., Sabir, S., Qayyum, U., & Anjum, S. (2023). Estimating the effect of technological innovations on environmental degradation: empirical evidence from selected ASEAN and SAARC countries. Environment, Development and Sustainability, 25(7), 6529–6550.
Kinley, R., Cutajar, M. Z., de Boer, Y., & Figueres, C. (2021). Beyond good intentions, to urgent action: Former UNFCCC leaders take stock of thirty years of international climate change negotiations. Climate Policy, 21(5), 593–603.
Kinley, R., Cutajar, M.Z., de Boer, Y., & Figueres, C. (2021). Beyond good intentions, to urgent action: Former UNFCCC leaders take stock of thirty years of international climate change negotiations. Climate Policy, 21(5), 593-603.
Kousar, S., Ahmed, F., Pervaiz, A., Zafar, M., & Abbas, S. (2020). A panel co-integration analysis between energy consumption and poverty: New evidence from South Asian countries. Estudios De Economía Aplicada, 38(3), 4.
Le, T. H., Chang, Y., & Park, D. (2016). Trade openness and environmental quality: International evidence. Energy Policy, 92, 45–55.
Lin, B., & Zhu, J. (2019). Determinants of renewable energy technological innovation in China under CO2 emissions constraint. Journal of environmental management, 247, 662-671.
Mahrinasari, M., Haseeb, M., & Ammar, J. (2019). Is trade liberalization a hazard to sustainable environment? Fresh insight from ASEAN countries. Polish Journal of Management Studies.
Maqsood1, N., Shahid2, T. A., Amir3, H., & Kanwal Bilal4. (2023). Symmetric impact of Trade, exchange rate, and inflation rate on Stock Market in Pakistan: New evidence from Macroeconomic variables. Bulletin of Business and Economics, 12(3), 903–911.
Mensah, C. N., Long, X., Boamah, K. B., Bediako, I. A., Dauda, L., & Salman, M. (2018). The effect of innovation on CO 2 emissions of OCED countries from 1990 to 2014. Environmental Science and Pollution Research, 25, 29678-29698.
Mert, M., Bölük, G., & Çağlar, A. E. (2019). Interrelationships among foreign direct investments, renewable energy, and CO2 emissions for different European country groups: A panel ARDL approach. Environmental Science and Pollution Research, 26(21), 21495–21510.
Minhas, A. S., Maqsood, N., Shahid, T. A., & Rehman, A. U. (2024). Investment Performance in Green Finance: Assessing the Impact of Environmental Social and Governance Integration. IRASD Journal of Economics, 6(1), 27–44.
Osobajo, O. A., Otitoju, A., Otitoju, M. A., & Oke, A. (2020). The impact of energy consumption and economic growth on carbon dioxide emissions. Sustainability, 12(19), 7965.
Rehman, A., & Ahmad, A. (2024). Exploring the Non-linear Relationship between Oil Price Uncertainty and Manufacturing Production in Pakistan. Journal of Energy and Environmental Policy Options, 7(1), 19-27.
Roussel, Y., & Audi, M. (2024). Exploring the Nexus of Economic Expansion, Tourist Inflows, and Environmental Sustainability in Europe. Journal of Energy and Environmental Policy Options, 7(1), 28-36.
Sadia Bint Raza, Sheikh, S. M., & Rahman, S. U. (2024). The Mediating Role of Agency Cost between Corporate Governance and Financial Performance: Evidence from Pakistan Stock Exchange. IRASD Journal of Economics, 6(1), 144–163.
Saeed, R., Rahman, S. U., & Sheikh, S. M. (2024). Green Investment, Energy Consumption and Environmental Pollution Nexus G-7 Countries: A Historical Perceptive. Pakistan Journal of Humanities and Social Sciences, 12(1), 127–136.
Saud, S., Chen, S., & Danish, & Haseeb, A. (2019). Impact of fnancial development and economic growth on environmental quality: An empirical analysis from Belt and Road Initiative (BRI) countries. Environmental Science and Pollution Research, 26(3), 2253–2269.
Sehrish Arshad, S. J., Rahman, S. U., & Idress Sadia, T. A. S. (2024). Decarbonizing the Future: A Critical Review of Green Energy, Financial Inclusion and Trade Openness on CO2 Emissions. Bulletin of Business and Economics, 13(2), 160–163.
Shaari, M. S., Abdul Karim, Z., & Zainol Abidin, N. (2020). The effects of energy consumption and national output on CO2 emissions: New evidence from OIC countries using a panel ARDL analysis. Sustainability, 12(8), 3312.
Shahid, T. A., Rahman, S. U., Sheikh, S. M., & Allahrakha, R. (2024). Effect of Public Investment on Health Population: A Review of BRICS Countries. IRASD Journal of Economics, 6(1), 1–9.
Shahid, T. A., Zafar, M., & Minhas, A. S. (2023). Testing the Economic Theory of Crime in case of Pakistan. 1(2), 73–86.
Shen, Y., Ur Rahman, S., Hafiza, N. S., Meo, M. S., & Ali, M. S. E. (2024). Does green investment affect environment pollution: Evidence from asymmetric ARDL approach? PLoS ONE, 19(4 April), 1–25.
Song, M., Anees, A., Rahman, S. U., & Ali, M. S. E. (2024). Technology transfer for green investments: exploring how technology transfer through foreign direct investments can contribute to sustainable practices and reduced environmental impact in OIC economies. Environmental Science and Pollution Research, 31(6), 8812–8827.
Tawari, N. (2024). Examining the Demand-Pull Factors of Household Electricity Consumption in Delhi. Journal of Energy and Environmental Policy Options, 7(1), 37-44.
Töbelmann, D., & Wendler, T. (2020). The impact of environmental innovation on carbon dioxide emissions. Journal of Cleaner Production, 24
Ullah, A., & Ali, A. (2024). Investigating Corruption, Income Inequality, and Environmental Degradation in Pakistan: A Time Series Analysis. Journal of Energy and Environmental Policy Options, 7(1), 9-18.
Usman, M., & Hammar, N. (2021). Dynamic relationship between technological innovations, financial development, renewable energy, and ecological footprint: fresh insights based on the STIRPAT model for Asia Pacific Economic Cooperation Countries. Environmental Science and Pollution Research, 28(12), 15519-15536.
Usman, M., & Hammar, N. (2021). Dynamic relationship between technological innovations, financial development, renewable energy, and ecological footprint: fresh insights based on the STIRPAT model for Asia Pacific Economic Cooperation countries. Environmental Science and Pollution Research, 28(12), 15519–15536.
Usman, M., Kousar, R., Makhdum, M. S. A., Taseen, M. R., & Nadeem, A. M. (2023). Do financial development, economic growth, energy consumption, and trade openness contribute to increase carbon emission in Pakistan? An insight based on ARDL bound testing approach. Environment, Development and Sustainability, 25(1), 444-473.
Xu J, Guo C, Chen X, Zhang Z, Yang L, Wang M, Yang K (2019) Emission transition of greenhouse gases with the surrounding rock weakened—a case study of tunnel construction. J Clean Prod 209:169–179
Zafar, M. W., Shahbaz, M., Sinha, A., Sengupta, T., & Qin, Q. (2020). How renewable energy consumption contribute to environmental quality? The role of education in OECD countries. Journal of Cleaner Production, 268, 122149.
Zhou, Y., Fu, J., Kong, Y., & Wu, R. (2018a). How foreign direct investment influences carbon emissions, based on the empirical analysis of Chinese urban data. Sustainability, 10(7), 2163.
Zubair, S., Rahman, S. U., Sheikh, S. M., & Zafar, M. (2024). A Review of Green Innovation and Environmental Performance in BRICS Nations. Pakistan Journal of Humanities and Social Sciences, 12(1), 444–449.
