An investigation of the nexus between natural resources, environmental performance, energy security and environmental degradation: Evidence from Asia.

Abstract

Sustainable development requires having a healthy environmental system with an increasing growth rate over the time. But most of the Asian economies have pursued economic growth at the cost of environment and this needs careful analysis. This study focuses on the environmental degradation, measured by ecological footprint, of the 45 resource-rich countries of Asia. It utilizes several panel techniques including the instrumental variable two-stage least square technique over the period from 1990 to 2018, in order to examine the determinants of ecological footprint with significant emphasis on the role of resource rent. Our empirical findings show that natural resource rent is negatively related to ecological footprint. We equally observed a negative nexus between energy security and ecological footprint, indicating that countries need to be secured in terms of energy to reduce the degradation of environment. Our estimates also revealed a non-linear relationship between ecological footprint and economic growth – even though it contrasts the EKC hypothesis. Additionally, while environmental performance index has been observed to promote ecological footprint, population growth reduces environmental sustainability. This study, therefore, offers a roadmap to stakeholders and policymakers regarding the ways to improve the environmental quality in respective economies.