GLOBALISATION, RESOURCE WEALTH, AND THE ENVIRONMENTAL KUZNETS CURVE: PATHWAYS TOWARD SUSTAINABLE GROWTH IN ARCTIC ECONOMIES
Keywords:
Financial Development, Economic Growth, Energy Consumption, Environmental Quality, Globalization, Natural Resource Rents, Financial Development, Economic Growth, Energy Consumption, Environmental Quality, Globalization, Natural Resource Rents
Abstract
Sustainable growth in emerging economies depends largely on relationships between financial advancement, globalization, utilization of resources and environment quality. The paper employed the Dynamic panel System GMM estimation with robustness checks (2SLS) to examine the associations among financial development, energy consumption, natural resource rents, globalization, economic growth, and CO 2 emission by using a balanced panel consisting of 8 emerging economies, from 2015 to 2023). The study revealed that financial development contributes tremendously to economic growth with no direct impact on the quality of environment, although energy consumption contributes both to economic growth and environmental degradation. The positive impacts of natural resource rents are obviously an improved quality of the environment, which denotes enhanced governance, and globalization plays a significant role in enhancing growth, with no direct impact on the environment. The EKC hypotheses is also affirmed (negative squared term of GDP), implying higher levels of income result in decreasing environmental degradation. The paper suggest some policy implications on integration of green finance, green energy transition, management of resources, development of globalization strategies in line with environmental goals. Future studies are necessary to further increase the geographic and time dimensions and study sector and institutional-specific dynamics.
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References
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Apergis, N., & Payne, J. E. (2010). The emissions, energy consumption, and growth nexus: Evidence from the Commonwealth of Independent States. Energy Policy, 38(1), 650–655.
Arellano, M., & Bover, O. (1995). Another look at the instrumental variable estimation of error-components models. Journal of Econometrics, 68(1), 29–51.
Arrow, K., Dasgupta, P., Goulder, L., Mumford, K. J., & Oleson, K. (2012). Sustainability and the Measurement of Wealth. Environment and Development Economics, 17(3), 317–353.
Balsalobre-Lorente, D., Shahbaz, M., Roubaud, D., & Farhani, S. (2018). How economic growth, renewable electricity, and natural resources contribute to CO₂ emissions? Renewable Energy, 169, 1131–1143. h
Levine, R., Beck, T., & Demirguc-Kunt, A. (2009). Financial Institutions and Markets across Countries and over Time: Data and Analysis. World Bank Policy Research Working Paper 4943.
Beck, T., Levine, R., & Loayza, N. (2010). Finance and the Sources of Growth. Journal of Financial Economics, 58(1–2), 261–300.
Blundell, R., & Bond, S. (1998). Initial conditions and moment restrictions in dynamic panel data models. Journal of Econometrics, 87(1), 115–143.
BP. (2023). Statistical Review of World Energy 2023. https://www.bp.com/en/global/corporate/energy-economics/statistical-review-of-world-energy.html
Huang, Y., Chen, C., Lei, L., & Zhang, Y. (2022). Impacts of green finance on green innovation: A spatial and nonlinear perspective. Journal of Cleaner Production, 365, 132548.
Cust, J., & Mihalyi, D. (2017a). Evidence for a Presource Curse? Oil Discoveries, Elevated Expectations, and Growth Disappointments. Oxford Centre for the Analysis of Resource Rich Economies (OxCarre) Research Paper 193 https://ora.ox.ac.uk/objects/uuid:d9afd927-4782-4028-9a34-926658bb2286/files/s8w32r6041
Cust, J., & Mihalyi, D. (2017b). The presource curse: Oil discoveries can lead first to jubilation then to economic jeopardy. International Monetary Fund. https://www.imf.org/external/pubs/ft/fandd/2017/12/pdf/arezki.pdf
Dinda, S. (2004). Environmental Kuznets Curve Hypothesis: A Survey. Ecological Economics, 49(4), 431–455.
Dreher, A. (2006). Does Globalization Affect Growth? Evidence from a New Index of Globalization. Applied Economics, 38(10), 1091–1110.
Frankel, J. A., & Rose, A. K. (2005). Is trade good or bad for the environment? Sorting out the causality. Review of Economics and Statistics, 87(1), 85–91.
Grossman, G. M., & Krueger, A. B. (1995). Economic Growth and the Environment. Quarterly Journal of Economics, 110(2), 353–377.
IEA. (2023). World Energy Outlook 2023. International Energy Agency. https://www.iea.org/reports/world-energy-outlook-2023
Larsen, J. N., & Fondahl, G. (Eds.). (2015). Arctic Human Development Report: Regional Processes and Global Linkages. Nordic Council of Ministers.
Le, H. P., & Ozturk, I. (2020). The impacts of globalization, financial development, government expenditures, and institutional quality on CO₂ emissions in the presence of environmental Kuznets curve. Environmental Science and Pollution Research, 27(18), 22619–22631.
Levine, R. (2005). Finance and Growth: Theory and Evidence. In P. Aghion & S. Durlauf (Eds.), Handbook of Economic Growth (Vol. 1A, pp. 865–934). Elsevier.
Rafique, M.Z., Li, Y., Larik, A.R. et al. (2020). The effects of FDI, technological innovation, and financial development on CO2 emissions: evidence from the BRICS countries. Environ Sci Pollut Res 27, 23899–23913.
Mol, A. P. J., & Spaargaren, G. (2000). Ecological modernization theory in debate: A review. Environmental Politics, 9(1), 17–49.
Le, T.-H., Chang, Y., & Park, D. (2016). Trade openness and environmental quality: International evidence. Energy Policy, 92, 45–55.
Duan, D., & Liu, K. (2023). Do financial inclusion, natural resources and green innovation affect the sustainable environment in resource rich economies? Resources Policy, 86(Part A), 104190.
Drago, C., Costantiello, A., Arnone, M., & Leogrande, A. (2025). Bridging sustainability and inclusion: Financial access in the environmental, social, and governance landscape. Journal of Risk and Financial Management, 18(7), 375.
Bach, M. (2018). The oil and gas sector: from climate laggard to climate leader? Environmental Politics, 28(1), 87–103.
Ozturk, I. (2010). A Literature Survey on Energy–Growth Nexus. Energy Policy, 38(1), 340–349.
Romer, P. M. (1990). Endogenous technological change. Journal of Political Economy, 98(5), S71–S102.
Roodman, D. (2009). A Note on the Theme of Too Many Instruments. Oxford Bulletin of Economics and Statistics, 71(1), 135–158.
Sachs, J. D., & Warner, A. M. (2001). The curse of natural resources. European Economic Review, 45(4–6), 827–838.
Sachs, J., Schmidt-Traub, G., Kroll, C., Lafortune, G., & Fuller, G. (2019). Sustainable Development Report 2019. Bertelsmann Stiftung and Sustainable Development Solutions Network. https://sdgtransformationcenter.org/reports/sustainable-development-report-2019
Sadorsky, P. (2010). The Impact of Financial Development on Energy Consumption in Emerging Economies. Energy Policy, 38(5), 2528–2535.
Shahbaz, M., Solarin, S. A., Mahmood, H., & Arouri, M. (2013). Does financial development reduce CO₂ emissions in Malaysian economy? A time series analysis. Economic Modelling, 35, 145–152.
World Bank. (2023). World Development Indicators 2023. https://databank.worldbank.org/source/world-development-indicators
Published
2024-10-31
How to Cite
Muritala, T. (2024). GLOBALISATION, RESOURCE WEALTH, AND THE ENVIRONMENTAL KUZNETS CURVE: PATHWAYS TOWARD SUSTAINABLE GROWTH IN ARCTIC ECONOMIES. J-MACC : Journal of Management and Accounting, 7(2), 286-302. https://doi.org/https://doi.org/10.52166/j-macc.v7i2.11775
Section
Articles
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