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Does economic complexity matter for environmental sustainability? Using ecological footprint as an indicator
Muhammad Zahid Rafique1, Abdul Majeed Nadeem2, Wanjun Xia3
1Centre for Economic Research, Shandong University, 27-Shanda Nanlu, Jinan Shandong, 250100 People's Republic of China.
Environment, Development and Sustainability
|July 7, 2021
Summary
Economic complexity, growth, trade, and urbanization worsen ecological footprints, while human capital and renewable energy offer mitigation. Investing in renewables and human capital can improve environmental quality and economic complexity.
Area of Science:
- Environmental Science
- Environmental Economics
Background:
- Ecological footprint research is growing, yet key determinants remain under-explored.
- Understanding factors influencing ecological footprints is crucial for environmental sustainability.
Purpose of the Study:
- To investigate the relationship between economic complexity, human capital, renewable energy, urbanization, economic growth, export quality, trade, and ecological footprint.
- To analyze these associations for the ten most economically complex countries.
Main Methods:
- Panel data analysis utilizing Fully Modified Ordinary Least Squares (FMOLS), Dynamic Ordinary Least Squares (DOLS), and System Generalized Method of Moments (GMM).
- Data spans from 1980 to 2017 for the top ten economic complex countries.
Main Results:
- Economic complexity, economic growth, export quality, trade, and urbanization were found to increase the ecological footprint.
- Human capital and renewable energy generation demonstrated a mitigating effect on the ecological footprint.
Conclusions:
- Investment in renewable energy generation and consumption is vital for environmental improvement.
- Efficient utilization of human capital can enhance economic complexity, export quality, and environmental outcomes.
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