Environmental deterioration in the age of industrialization and production: do industrial competition and renewable energy reduce the ecological burden?

The modern era of globalization, economic development, and increase in manufacturing activity pose severe risks to the natural environment. In this context, industries must prioritize sustainable economic growth and development. Thus, the purpose of this study is to provide insight into industrial competition, renewable energy, economic freedom, manufacturing value added, economic growth, and carbon dioxide emissions (CO2 emissions) in the top ten high-income countries from 1997 to 2019. The results from panel cross-sectional autoregressive distributed lag (CS-ARDL), augmented mean group (AMG), and common correlated effects mean group (CCEMG) techniques revealed that economic growth and industrial production have a harmful influence on CO2 emissions. Meanwhile, industrial competitiveness, renewable energy, and economic freedom are all negatively associated with CO2 emissions. This specifies that industrial competitiveness, renewable energy, and economic freedom are favorably related to environmental sustainability by limiting CO2 emissions in the top ten high-income countries. These findings imply that governments and responsible authorities/policymakers develop strategies to reduce the environmental impact of manufacturing value addition and economic growth in the top ten high-income countries and allocate more financial resources to renewable energy and promote industrial competition.

Revisiting the nexus between economic growth and environment health: an empirical study on 180 nations.

Sustainability is considered to be one of the biggest issues in the current time. This study aims to understand the role of sustainability further by revisiting the much-debated and intricate relationship between economic growth and environmental performance and to provide guidance to policymakers. Using a large sample of data from 180 countries over the period from 2002 to 2017 a measure that captures the various aspects of environmental performance, the study performs a test of the Environmental Kuznets Curve (EKC) hypothesis, which defines the relationship between economic growth and environmental deterioration. Controlling for several associated macroeconomic and governance variables, the results suggest that for certain regions, viz. Asia, Eastern Europe, and North America, higher economic growth, as proxied by per capita GDP, has a negative association with environmental performance (measured by Environmental Performance Indices, EPI), indicating that the former may prove detrimental to the later. The results suggest a unidirectional relationship between the two variables and are also robust to endogeneity concerns that are often emphasized in the EKC literature. The study documents similar results for lower-income and lower-middle-income countries. Interestingly, the authors also find that small-sized governments in developing nations have a positive association with environmental performance.

How does government efficiency affect carbon emission intensity? A comprehensive empirical study.

This study utilized panel data from 132 countries spanning from 1996 to 2019 to examine the effect of government efficiency on carbon emission intensity. Using a fixed effect model, the study found that stronger government efficiency is associated with a significant decrease in carbon emission intensity. Robustness tests were performed, the results of which consistently supported the main findings. Additionally, the study investigated the mechanisms underlying the linkage between government efficiency and carbon emission intensity, revealing that improved government efficiency can inhibit carbon emission intensity by fostering environmental innovation and promoting renewable energy consumption. Finally, the study examined the moderating effects of national income level, economic freedom, democracy, and ruling party ideology on the nexus of government efficiency and carbon emission intensity, and found empirical evidence supporting these moderating effects. These results provide new insights for governments seeking to reduce carbon emission intensity.

The impact of education level and economic freedom on gender inequality: panel evidence from emerging markets.

Gender equality is a critical factor for all ingredients of a healthy society and sustainable development. Therefore, measures to decrease gender inequalities in economic, social, and political life are important for the economic and social development of a society. This study analyzes the influence of education level and economic freedom on gender inequality in emerging markets over the 2000-2020 term through causality and cointegration tests. The results of the causality test uncover a bidirectional causality between education level, economic freedom, and gender inequality. In other words, there exists a mutual interaction among education level, economic freedom, and gender inequality in the short term. Furthermore, the findings of cointegration analysis indicate that education level and economic freedom have a negative impact on gender inequality in the long term, but education level is much more effective on gender inequality than economic freedom in nearly all emerging markets.

The role of economic freedom in achieving the environmental sustainability for the highest economic freedom countries: testing the environmental Kuznets curve hypothesis.

In the study, the relationship between ecological footprint, economic freedom, renewable energy consumption, and economic growth is analysed under the scope of environmental Kuznets curve (EKC) hypothesis. Here, fifteen countries with the highest economic freedom for the period 1996-2018 are selected to more clearly underline the impact of economic freedom on the environment and examined, i.e., Australia, Canada, Denmark, Estonia, Finland, Germany, Latvia, Lithuania, Luxembourg, Netherlands, Norway, Singapore, South Korea, Sweden, and Switzerland. The long-term relationship between the variables is examined using the panel cointegration test. According to the test results, it has been observed that the variables in the EKC model act together in the long run. According to the long-term estimation results, it is seen that economic freedom decreases the ecological footprint, namely, environmental degradation, in Canada, while it increases in Estonia. Furthermore, it is concluded that renewable energy reduces the ecological footprint in Australia, Denmark, Luxembourg, Norway, Singapore, and Switzerland. Nevertheless, it has been determined that the EKC hypothesis is valid for Canada, Denmark, and Singapore, but not for other countries.

An application of the LASSO and elastic net regression to assess poverty and economic freedom on ECOWAS countries.

The study of poverty has been studied from several different research approaches over the years. This analysis intended to determine which variables tell us about poverty in the Economic Community of West African State (ECOWAS) countries. Many ECOWAS countries have recorded high economic growth rates in the past few decades. However, a recent trend is that this progress is reversing, and poverty rates are increasing. In this analysis, we examined the variables describing poverty in ECOWAS. We used a statistical approach coupled with economic theory to justify the inclusion of the variables used to assess poverty. Furthermore, we include the use of the Fraser Institute's Economic Freedom index for each of the West African States. As far as we know, the economic freedom and poverty of West African states have not been presented for consideration toward African growth rates and poverty rates. With few exceptions, economic freedom research suggests that economic freedom is the foundational ingredient for increasing prosperity and reducing poverty. Then, we interpreted the empirical results and assess the validity of the model as applied to the ECOWAS countries. More specifically, we use the LASSO and elastic net regression to obtain sparse solutions to regression problems. LASSO and elastic net are computational methods that rapidly inform us about the relevant variables for the model. These computational methods' performances will in the context of the number of variables exceeds the number of observations by generating a low mean squared error (MSE).

The effect of technological progress and income per capita on carbon dioxide emission: the moderating role of economic freedom.

Climate change in context of environmental issues is pushing most of the countries to set the goals in order to achieve carbon neutrality and sustainable development. The recognition of Sustainable Development Goal (SDG) thirteen (13) is aided by the objective of this study which is to take an urgent action to combat climate change. In this context, this study investigates the effect of technological progress, income, and foreign direct investment on carbon dioxide emission by taking into consideration the moderating effect of economic freedom in 165 global countries from 2000 to 2020. The study employed ordinary least squares (OLS), fixed effects (FE), and two-step system generalized method of moments for analysis. The findings reveal that economic freedom, income per capita, foreign direct investment, and industry increase carbon dioxide emission while technological progress reduces emission in global countries. Surprisingly, economic freedom indirectly increases the level of carbon emissions by technological progress; however, economic freedom indirectly decreases the level of carbon emissions by income per capita. In this regard, this study favors clean eco-friendly technologies and seeks methods for development without harming the environment. Furthermore, the findings of this study have considerable policy suggestions for the sample countries.

Economic freedom and carbon emissions across the globe: the mediating effect of renewable energy consumption.

A growing number of studies have examined the extent to which economic liberalization policies would influence carbon emissions. These studies have examined this relationship while neglecting the key role that renewable energy could play in this complex relationship. The study fills that gap. It aims to examine the mediated effect of renewable energy consumption in the relationship between economic freedom and carbon emissions in 138 countries worldwide over the period 1995-2018. In this perspective, the study followed a second-generation panel econometric tests. We used Driscoll and Kraay standard errors (DKSE) and common correlated effect mean group (CCEMG) estimators for baseline results. The robustness of the results was checked using fully modified ordinary least squares (FMOLS), system generalized method of moments (System-GMM), and quantile regression (QREG). Furthermore, the study mobilized Dumitrescu and Hurlin's panel causality test to examine the causal relationship between the variables under study. The results suggest that economic freedom has a direct and indirect negative effect on carbon emissions and that renewable energy consumption mediates the effect of economic freedom on carbon emissions. These results remained unchanged at the battery of robustness checks. Moreover, Dumitrescu and Hurlin's panel causality test results indicated a bidirectional causal relationship between economic freedom, renewable energy consumption, economic growth, economic globalization, and population size with carbon emissions. The various empirical findings have helped to formulate useful policy implications for policy-makers to ensure environmental sustainability.

Asymmetrical analysis of economic complexity and economic freedom on environment in South Asia: A NARDL approach.

The environment has become a growing concern for many countries, as pollution and other environmental degradation can harm human health, economic growth, and overall well-being. This paper probes into the asymmetrical implications of economic complexity and freedom on ecological quality in four South Asian countries from 1995 to 2019. Using Nonlinear Autoregressive Distributed Lag methodology approach, our findings indicate that carbon dioxide (CO2) emissions are intensified by economic freedom both in the long and short term, while negative and positive shocks to economic complexity increase CO2 emissions in the long term. However, a negative economic complexity shock increases CO2 emissions, whereas a positive shock has the opposite effect in the short run. Moreover, our results confirm the validity of the environmental Kuznets curve (EKC) hypothesis in the long run. Furthermore, we find that renewable energy usage and the interaction of FDI and renewable energy usage can help reduce environmental damage in both the short and long run. The findings suggest that countries should focus on attracting foreign direct investment that promotes the use of renewable energy. Additionally, policies aimed at encouraging renewable energy use should be implemented. It is important to note that as economic freedom and complexity increase, there is a corresponding increase in CO2 emissions. Therefore, South Asian policy makers are advised to prioritize the reduction in fossil fuels, the promotion of energy-saving technologies and efficient production, and trade that encourages the transition of renewable energy sources to reduce CO2 emissions.

Do economic freedom, innovation, and technology enhance Chinese FDI? A cross-country panel data analysis.

This study evaluates the determinants of Economic freedom, innovation and technology concerning Chinese foreign direct investment. The aim of the study is to explore, that how these determinants influence Outward Foreign Direct Investment (OFDI) from China toward different regional economies. The study will enrich the existing literature by providing useful policies to the concerned economies to influence more Chinese FDI to host economies. The panel data set includes 27 (African, European, and Asian) Countries data over the period of 2003 to 2018. Moreover, the study employed panel data analysis and the result reveals that property rights, patents residents (pantentAR), Research & Development (R&D), Inflation, official exchange rate (OER), and Tax Burden (TaxB) have a strong positive and significant impact on Chinese OFDI in the selected sample countries, While Government Expenditures (GovE) has positive, but insignificant impact on Chinese OFDI. On the other hand, Chinese OFDI is negatively and statistically significant association with Business Freedom (BusF). This study will put forth considerable policies to the concerned to induce further inflows of Chinese FDI into the host countries. The policymakers should build policies that provide a comfortable environment for business activities and mostly focus on value-added production i.e., expenditures on R&D to enhance high-technology exports because they efficiently attract FDI into host countries. Another key factor is Tax Burden (TaxB), which significantly influences Chinese FDI along with other factors.

Free to die: Economic freedoms and influenza mortality.

Seasonal influenzas are annually responsible for hundreds of thousands of deaths worldwide, often because of insufficient care, which may depend on orientations of economic policy. Yet, the empirical evidence on the relations existing between policies based on different degrees of economic liberalism and flu mortality is still scarce. This paper contributes to filling the gap by proposing an empirical investigation into the effects of various dimensions of liberalism, proxied by the different components of the Fraser Index of Economic Freedom, on deaths from seasonal influenzas in a sample of 38 OECD countries observed from 1970 to 2018. A dynamic panel System-GMM estimator is used to alleviate endogeneity concerns, while alternative models, specifications and subsamples check the robustness of findings. Findings show that: a) not every component of economic freedom has an effect on flu mortality; b) more economic freedom not always means less or more deaths from flu. In particular, stronger protection of property rights and smaller government consumption are associated with higher flu mortality, which is instead lower when people and capital are freer to move. Such results give rise to policy considerations and contribute to inform policymakers about actions that can limit the mortality of a globally widespread disease like flu.

Decomposed and composed effects of economic freedom on economic growth in south Asia.

It is frequently asserted that high levels of economic growth are supported by economic freedom. For the period 1995-2021, this study examines the influence of the composed economic freedom index and several subcomponents of economic freedom on the economic growth of four South Asian economies, namely Bangladesh, India, Pakistan, and Sri Lanka. The Ordinary Least Squares, Random Effect Model, and Robust Least Squares approaches are utilized to estimate the composed and decomposed influence of economic freedom on economic growth. Robust Least Squares reflects the robustness of the connection between economic liberty and growth. According to the results of these tests, economic liberty has a strong and favorable stimulus on growth. When the different indicators of economic liberty are evaluated independently, we discovered that the magnitudes of most economic freedom indicators are significant. Conversely, monetary freedom contributes very little to economic expansion. The effects of government spending, public trust, and labor flexibility on economic expansion are hypothetical. The tax load hinders economic expansion in the economies under consideration. Property rights, freedom to do business, trade liberty, investment choice, and financial liberty all have a positive, strong, and sizeable stimulus on economic growth. The decomposed influence of each indicator of economic freedom will help develop policy choices.

Does the economic freedom hinder the underground economy? Evidence from a cross-country analysis.

We evaluate the impact that the economic freedom exerts on the shadow economy for a sample of 152 countries from 1995 to 2017. In order to solve endogeneity issues, we rely on an instrumental variable approach and find that a change in the economic freedom index, induced by the level of independence of financial markets from government actions, adversely affects the hidden economy. To corroborate the interpretation of our results we also show how each subcomponent of the economic freedom index explains the downward change registered in the shadow economy. Further, the negative effect is mainly found in countries characterized by a low level of democracy and strong corruption, whereas in more democratic and less corrupt countries the economic freedom positively affects the size of the shadow economy. Consistent with these findings, we also highlight that the effect of the composite indicator of economic freedom on the hidden economy is U-shaped and this relationship is exclusively driven by both business regulation and the freedom in the legal system and property rights.

Is too much foreign aid a curse or blessing to developing countries?

The aim of the study was to examine the relationship between amount of aid received and economic growth of developing nations and the role of quality of institutions and economic freedom in shaping the relationship between the two. To this effect, a panel data from 2006 - 2019 was gathered from 48 developing countries and an innovative dynamic panel threshold regression was used for estimation. Accordingly, it is found in this study that the relationship between aid and economic growth is nonlinear and U shaped, which shows the presence of threshold value of aid amounting 7.03% of GNI. The results further reveal that aid stimulates economic growth when the sampled developing countries attain a minimum institutional quality threshold of -0.320. As regards to the role of economic freedom, it is found that the overall economic freedom index of 53.481 should be attained to avoid undesirable effect of aid on economic growth. Therefore, the author recommends that donors should advance sufficient amount of aid to developing countries if they are really committed to support their economy. Recipient developing countries should improve up on the existing institutional setup and improve economic freedom indicators in order to get the best out of aid.

Pandemics, economic freedom, and institutional trade-offs.

We argue that institutions are bundles that involve trade-offs in the government's ability to provide public goods that affect public health. We hypothesize that the institutions underlying economic freedom affect the mix of diseases by reducing diseases of poverty relative to diseases of commerce (those associated with free movement of people, such as smallpox or COVID-19). We focus on smallpox and typhoid fever in the late nineteenth century and early twentieth century in order to build on recent work that make arguments similar to ours, especially the framework Werner Troesken sets forth in The Pox of Liberty. Our evidence shows that economic freedom, in multiple periods of time and settings prior to the eradication of smallpox in the second half of the twentieth century, reduced typhoid mortality but had no effect on smallpox deaths. The implication for COVID-19 is that the trade-off between fighting the pandemic and preserving economic freedom may not be too severe in the short run. However, in the long run, the wealth benefits from economic freedom are likely to be crucial in reducing vulnerability to diseases of commerce primarily from their impact on comorbidities (such as diabetes and heart disease). Thus, economic freedom is on balance good for public health, which suggests that it, while requiring trade-offs, might be the best institutional bundle for dealing with pandemics. Supplementary Information: The online version contains supplementary material available at 10.1007/s10657-021-09704-7.

Economic Freedom, Education and CO2 Emissions: A Causality Analysis for EU Member States.

Environmental sustainability is one of three pillars of sustainability. However, a significant worldwide deterioration in the environment has been experienced since the Industrial Revolution, but the efforts to protect the environment date back to the 1970s. In this context, many economic and non-economic factors underlying environmental degradation have been investigated until today, but the influence of economic freedom indicators and education on the environment have been relatively less analyzed and the researchers have mainly focused on the influence of economic and institutional variables on the environment. Therefore, this paper investigates the reciprocal interplay among economic freedom indicators, education, and environment in EU member states over the 2000-2018 term by using a causality test with cross-sectional dependency and heterogeneity and taking the research gap into consideration. The causality analysis indicates that market-oriented economic structure and education can be beneficial in combatting environmental degradation.

Impact of Economic Freedom and Educational Attainment on Life Expectancy: Evidence From the New EU Member States.

Life expectancy is a significant indicator of public health, life quality, welfare and economic development. Therefore, improvement in life expectancy is among the priority targets of the countries. This paper investigates the effect of economic freedom and educational attainment on life expectancy in the new EU member states, experiencing an institutional, educational, and economic transformation, during the period 2000-2019 by using cointegration and causality tests, because economic freedom and educational attainment can foster the life expectancy through institutional and economic variables such as institutions, governance, sound monetary and fiscal policies, economic growth, innovation, technological development, better living standards and access to superior healthcare services. The causality and cointegration analyses reveal that economic freedom and educational attainment are significant factors underlying life expectancy in the short and long term. However, educational attainment is found to be more effective on life expectancy than economic freedom. The findings have important implications for educational and health policies in analyzed countries. Governments must understand the education-health relationship to be able to develop and promote educational policies that have the potential to improve public health.

Assessing the spatial effects of economic freedom on forest-products, grazing-land, and cropland footprints: The case of Asia-Pacific countries.

The literature has shown that economic freedom yields higher economic growth. However, the nexus between economic freedom and the environment in a world of spatial dependency is unclear. Using data from a panel of seventeen Asia-Pacific countries from 2000 to 2017, we investigate the direct and spillover effects of economic freedom (as measured by the annual indexes developed by the Heritage Foundation) and other variables on the ecological footprint of three land-cover types: cropland, forest products, and grazing land. Diagnostic tests confirm the existence of spatial-interaction effects in forest products and grazing land but reject it for cropland. Using a spatial Durbin panel model, we find that the intensity of energy use has a significant impact on the environmental footprint of all resource types. We also confirm the environmental Kuznets curve hypothesis for forest products and grazing land but not cropland. Unlike previous researchers, we find cropland footprints are unaffected by natural resource rents. We also find that the tax burden is the only economic freedom indicator with a positive and significant impact on all three environmental footprints. Our findings suggest that more investment freedom reduces environmental pressure on cropland and forest-products footprints but has a nonsignificant effect on the grazing-land footprint. Further, financial freedom reduces the forest-products footprint and increases the grazing-land footprint. Property rights, the tax burden, and business freedom increase environmental pressure while government spending lessens grazing land's ecological footprint. Our indirect and overall impact analyses suggest that all types of economic freedom reduce environmental strain in our panel. This research points to the importance of enacting environmental regulations in a way that guarantees ecological sustainability and economic development.

Assessing the linkages of economic freedom and environmental quality in South Asian Countries: application of CS-ARDL.

We examine the linkages of economic freedom (ECF), energy use, and CO2 emissions in selected South Asian countries of Pakistan, India, Bangladesh, and Sri Lanka. Annual data from 1995 to 2018 are analyzed by employing second-generation methodologies. Cross-sectional autoregressive distributed lag (CS-ARDL) is used because this method incorporates the cross-sectional dependence among the data. This work uses three models, where the dependent variables are gross domestic product (GDP), CO2 emissions, and energy use. The findings reveal that ECF and energy use contributes to more economic development. ECF is improving air quality by lowering CO2 emissions. The findings suggest that these countries need to increase the percentage of renewable energy in their energy generation mix. At the same time, there is a need to integrate ECF with environmental awareness programs. This will not only increase air quality but also increase economic growth. GDP is found to be dependent on energy use; however, increased energy use from non-renewable also contaminates the environment. Therefore, South Asian countries need to invest more in research and development projects to promote renewable energy.

The effects of energy price, spatial spillover of CO2 emissions, and economic freedom on CO2 emissions in Europe: a spatial econometrics approach.

Since the European Union (EU)'s current goal of making its continent the world's first climate-neutral continent by 2050, the EU will need to set a path for new policies in the areas of Europe's economy, energy consumption, and agriculture. Thus, this paper analyzes the marginal impact of energy price and economic freedom on Europe's CO2 emissions grounded on the extended Stochastic Impacts by Regression on Population, Affluence and Technology ecology (STIRPAT) model together with the spatial econometric models. The results indicate the existence of spatial spillover effect of CO2 emissions among some countries in Europe. The Hausman test was also performed to select the best model between the random effects and the fixed effects. The findings suggest that increasing both economic freedom and energy price in a local country turns to reduce the country's own CO2 emissions and also reduces the emissions of its adjacent countries. Comparing the direct effect of economic freedom and energy price to that of the SDM fixed effect, a feedback of 12.77% and 23.53% of the direct effect was observed, respectively. The results also indicated that the turning point of economic freedom and economic growth was 6.714 and thus 9.083. Overall, the study spotlighted some policy suggestions for the energy market for the European commission in reducing the emissions of CO2.