Natural resource abundance, renewable energy, and ecological footprint linkage in MENA countries.

Abstract

Apart from being vulnerable to the menace created by climate change, the MENA countries consume more of non-renewable energy despite their resource endowments and great renewable energy potentials. Energy consumption, natural resources and urbanization may add to environmental degradation since ecological distortions mostly emanate from human activities. This study investigates the effects of the aforementioned variables on the ecological footprint (EFP) in MENA countries. The findings confirm the Environmental Kuznets Curve (EKC) hypothesis and further reveal the negative impact of natural resources and economic growth on the environment. Renewable energy and urbanization reduce EFP. The Fully Modified Ordinary Least Squares (FMOLS) and Dynamic Ordinary Least Squares (DOLS) were applied to obtain the country-specific results which reveal that urbanization surge promotes environmental degradation in all the countries except in Algeria, Bahrain, Tunisia, and Morocco were it is not particularly harmful. Natural resource rent increases the EFP in the UAE, Oman, and Lebanon. Further findings suggest a feedback causality between urbanization, economic growth and EFP. Policy directions based on the findings are extensively discussed.