The environmental Kuznets curve for Turkish provinces: a spatial panel data approach

Area of Science:

• Environmental Economics
• Spatial Econometrics
• Regional Science

Background:

• The Environmental Kuznets Curve (EKC) hypothesis suggests environmental degradation initially increases with economic growth but then decreases after a certain income level.
• Previous studies on Turkey's EKC often used country-level data or panel methods ignoring spatial dependencies.
• Provincial-level SO2 data from Turkish provinces (2004-2019) are analyzed to address these limitations.

Purpose of the Study:

• To empirically test the Environmental Kuznets Curve (EKC) hypothesis in Turkish provinces.
• To investigate the non-linear relationship between economic development and sulfur dioxide (SO2) emissions.
• To account for spatial spillovers in the EKC analysis for Turkey.

Main Methods:

• Utilized traditional panel data methodology integrated with spatial econometrics techniques.
• Analyzed provincial SO2 measurements and economic indicators for Turkish provinces from 2004 to 2019.
• Incorporated a spatial component to address potential biases from spatial dependence and spillovers.

Main Results:

• Confirmed a non-linear relationship between regional economic growth and environmental degradation (SO2 levels).
• Found a U-shaped, rather than the expected inverted U-shaped, relationship between economic development and SO2 emissions.
• Results remained robust after including spatial effects, confirming the significance of regional spillovers.

Conclusions:

• The EKC hypothesis in its traditional form does not fully explain the SO2-income relationship in Turkish provinces.
• A U-shaped curve suggests that environmental degradation may worsen initially with economic growth before potentially improving, with significant regional interactions.
• Policy interventions in Turkey post-2000 need tailored strategies considering spatial effects to mitigate environmental degradation.