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Can, Muhlis
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Economics, Econometrics & Finance Energy Environmental Science

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The Impact of Non-Green Trade Openness on Environmental Degradation in Newly Industrialized Countries van Hek, Sil; Can, Muhlis; Brusselaers, Jan
Ekonomikalia Journal of Economics Vol. 2 No. 2 (2024): October 2024
Publisher : Heca Sentra Analitika

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.60084/eje.v2i2.148

Abstract

Environmental degradation due to human over-exploitation is one of the most pressing global issues. The ten Newly Industrialized Countries (NICs) have recently witnessed substantial economic growth and involvement in global trade. In the discussion on environmental degradation, trade has a crucial role. Scholars use trade openness to test the scale effect on the environment. This research investigates the effect of non-green trade openness, economic growth, and energy consumption on ecological footprint. Panel estimation techniques such as cross-sectional dependence, slope homogeneity, unit root, and cointegration analyses are applied to panel data of ten NICs between 2003 and 2016. The Fully Modified Ordinary Least Squares (FMOLS) method reveals that non-green trade openness increases environmental degradation in the panel. Energy consumption and economic growth are also found to increase environmental degradation. Moreover, the Environmental Kuznets Curve (EKC) hypothesis is validated. The research presents a few relevant policy implications. The NICs should invest in green energy and an energy-efficient economy and focus on stimulating green trade as a catalyst for sustainable economic development in order to improve the quality of their environment. This can be done by introducing higher tariffs on non-green products and investing in technological innovations for green production methods and renewable energy. Although local environmental pollution in the European Union (EU) decreases, an increase in pollution in the NICs threatens the global state of the environment. Therefore, non-green trade should be approached as an international problem that has detrimental effects on all countries in different phases of economic development.
Toward a Greener Future: Investigating the Environmental Quality of Non-Green Trading in OECD Countries van Ledden, Anke; Can, Muhlis; Brusselaers, Jan
Ekonomikalia Journal of Economics Vol. 2 No. 1 (2024): April 2024
Publisher : Heca Sentra Analitika

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.60084/eje.v2i1.149

Abstract

International trade is recognized as a key contributor to environmental degradation. However, researchers and policymakers do not distinguish between the trade of green and non-green products. The Non-Green Trade Openness Index was developed to examine the effect of non-green products on environmental quality. This study examines the effect of trading non-green products on environmental quality for 37 member countries of the Organization for Economic Co-operation and Development (OECD) from 2003 to 2016 in the context of the Environmental Kuznets Curve (EKC) framework. The results of the long-run estimation techniques employed (FMOLS, DOLS, Fixed and Random effects) confirm the EKC hypothesis and show a negative relationship between the Non-Green Trade Openness Index and greenhouse gas emissions, which serves as a proxy for environmental quality. This implies that when there is more non-green trade in OECD member countries, greenhouse gas emissions within these countries decrease. Dividing green and non-green products is important, empowering practitioners and policymakers to make informed choices and define a strategy for a sustainable future. Additionally, policy recommendations are provided to support policymakers in their efforts to combat climate change.
The Impact of Green Trade Openness on Air Quality van Hinsberg, Nicky; Can, Muhlis
Ekonomikalia Journal of Economics Vol. 2 No. 2 (2024): October 2024
Publisher : Heca Sentra Analitika

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.60084/eje.v2i2.198

Abstract

Environmental degradation is among the most pressing issues the world faces today. Air pollution is one of the many forms of environmental degradation and can drastically impact human health and ecosystem functioning. Research shows that rapid intervention strategies are required to achieve the environmental targets set out by international agreements. One strategy that has been widely accepted to combat this issue of environmental degradation is the introduction of green products. The adoption of green products can be increased through trade. However, knowledge of the impact of trading these products is limited. This study examines the relationship between the trading of green products and air quality in a case study of 33 Organization for Economic Cooperation and Development (OECD) member countries from 2003-2016. We employ several panel strategies, such as the Westerlund (2008) Durbin-H method for cointegration and the Method of Moments Quantile Regression (MM-QR). The trading of green products was proxied by the newly developed ‘Green Openness Index.’ Nitrous oxide (NOx) and sulfur oxide (SOx) emissions served as proxies for air pollution. The relationship between the variables was explored in the context of the Environmental Kuznets Curve (EKC). The cointegration analysis reveals that there is a long-run relationship among the series. Long-run estimations prove that the EKC hypothesis is valid for the analyzed series. Additionally, the empirical findings reveal that trading environmentally friendly products increases air quality while energy consumption decreases. We provide several policy suggestions based on the study’s outcomes, such as supporting the trade liberalization of green goods, reducing tariff and non-tariff barriers for environmentally friendly products, and promoting the adoption of environmentally friendly goods by providing subsidies and other tax incentives to consumers.
Co-Authors Brusselaers, Jan van Hek, Sil van Hinsberg, Nicky van Ledden, Anke