Does ICT-Trade Openness ensure Energy and Environmental Sustainability? Empirical Evidence from selected South Asian Economies

Consumption of fossil fuels has triggered worldwide awareness to attain sustainability with respect to ensuring adequate energy access and mitigating environmental adversities, globally. Against this background, this paper aimed at investigating the impacts of enhancing ICT-trade openness on the transition from non-renewable to renewable energy use and carbon dioxide emissions in the context of six South Asian economies. The overall results from the econometric analyses confirm that greater openness to ICT-trade leads to greater consumption of renewable energy, reduces the intensity of energy-use and enhances the access to clean fuel and technology for cooking. However, although ICT trade is found to foster renewable energy consumption across South Asia, it fails to ensure renewable energy transition completely since greater openness to ICT-trade curbs the share of renewables in the aggregate energy consumption figures. Moreover, trade of ICT goods is found to reduce the levels of carbon emissions as well. Thus, these results impose key policy implications for the governments with respect to ensuring energy security alongside environmental sustainability across South Asia

Does ICT-Trade Openness ensure Energy and Environmental Sustainability? Empirical Evidence from selected South Asian Economies

Consumption of fossil fuels has triggered worldwide awareness to attain sustainability with respect to ensuring adequate energy access and mitigating environmental adversities, globally. Against this background, this paper aimed at investigating the impacts of enhancing ICT-trade openness on the transition from non-renewable to renewable energy use and carbon dioxide emissions in the context of six South Asian economies. The overall results from the econometric analyses confirm that greater openness to ICT-trade leads to greater consumption of renewable energy, reduces the intensity of energy-use and enhances the access to clean fuel and technology for cooking. However, although ICT trade is found to foster renewable energy consumption across South Asia, it fails to ensure renewable energy transition completely since greater openness to ICT-trade curbs the share of renewables in the aggregate energy consumption figures. Moreover, trade of ICT goods is found to reduce the levels of carbon emissions as well. Thus, these results impose key policy implications for the governments with respect to ensuring energy security alongside environmental sustainability across South Asia

Regional Integration, International Tourism Demand and Renewable Energy Transition: Evidence from selected South Asia Economies

The aim of this paper is to explore the international tourism demand-renewable energy consumption-intra-regional trade nexus across seven South Asian economies. The Emirmahmutoglu–Kose and Dumitrescu–Hurlin causality test results reveal unidirectional causalities stemming from tourist influx and intra-regional trade to renewable energy consumption. Moreover, bidirectional causality is found between tourism demand and regional trade. Thus, these results are anticipated to generate key policy implications

An Empirical Investigation of Real Exchange Rate Responses to Foreign Currency Inflows: Revisiting the Dutch Disease phenomenon in South Asia

Inflows of foreign currencies into the developing economies, in particular, have been associated with the Dutch disease phenomenon whereby a surge in such inflows is believed to stimulate real appreciation of the real exchange rate. As a result, there could be deindustrialization impacts on the recipient economies following a growth in the non-tradable sector at the expense of the tradable sector's contraction. This paper empirically investigates the dynamics of real exchange rate responses to official development assistance, foreign direct investments and international remittances flowing into the four emerging South Asian economies Bangladesh, India, Pakistan, and Sri Lanka. The results from the extensive econometric analyses show that a 1% rise in the total volume of official development assistance and remittances received appreciates the real exchange rate by 0.18% and 0.23% respectively. In contrast, a 1% rise in FDI inflows was found to trigger a 0.19% depreciation of the real exchange rate. Furthermore, the Dumitrescu and Hurlin (2012) test results reveal unidirectional long run causalities running from official development assistances and FDI inflow to real exchange rate while certifying a bidirectional causal association between inward international remittances and the real exchange rate

An Empirical Investigation of Real Exchange Rate Responses to Foreign Currency Inflows: Revisiting the Dutch Disease phenomenon in South Asia

Inflows of foreign currencies into the developing economies, in particular, have been associated with the Dutch disease phenomenon whereby a surge in such inflows is believed to stimulate real appreciation of the real exchange rate. As a result, there could be deindustrialization impacts on the recipient economies following a growth in the non-tradable sector at the expense of the tradable sector's contraction. This paper empirically investigates the dynamics of real exchange rate responses to official development assistance, foreign direct investments and international remittances flowing into the four emerging South Asian economies Bangladesh, India, Pakistan, and Sri Lanka. The results from the extensive econometric analyses show that a 1% rise in the total volume of official development assistance and remittances received appreciates the real exchange rate by 0.18% and 0.23% respectively. In contrast, a 1% rise in FDI inflows was found to trigger a 0.19% depreciation of the real exchange rate. Furthermore, the Dumitrescu and Hurlin (2012) test results reveal unidirectional long run causalities running from official development assistances and FDI inflow to real exchange rate while certifying a bidirectional causal association between inward international remittances and the real exchange rate

Trade Liberalization Policies and Renewable Energy Transition in Low and Middle-Income Countries? An Instrumental Variable Approach

A transition from the traditional dependence on use of non-renewable energy to the relatively environment-friendly renewable energy resources has been a key national agenda of governments across the globe. Keeping the environmental degradation and sustainable supply of energy into cognisance, it is pertinent to address the factors that possibly facilitate the renewable energy transitions worldwide. Against this backdrop, this paper aims to empirically analyse the compatibility of national trade liberalization policies with regards to promoting greater use of renewable energy across 71 low, lower-middle and upper-middle countries from South Asia, East Asia, Pacific, Central Asia, Latin America, Caribbean islands and Sub-Saharan Africa. Annual panel data between 2000 and 2017 is incorporated into the regression analyses using the Instrumental Variable Two-Stage Least Squares (IV-2SLS) and the Instrumental Variable Random Effects Generalized Least Squares (IV-RE-GLS) panel data estimators. The results indicate that greater openness to trade stimulates renewable energy consumption and also enhances the intensities of energy usage within the low and upper-middle income economies only. However, despite these upward pressures, trade openness does not guarantee higher shares of renewable energy use in the total energy consumption within these nations. Thus, the alignment of the trade liberalization policies in these countries with respect to attainment of the renewable energy transition can broadly be questioned. Furthermore, the results also indicate that trade liberalization within the lower middle-income countries is useful only in terms of enhancing the access to clean fuels and technology for cooking. The results, in a nutshell, imply that the impacts of trade liberalization on facilitation of renewable energy transition are large offset by other factors that trigger greater use of the non-renewable energy resources in these countries

Oil Price Shocks and Renewable Energy Transition: Empirical evidence from net oil-importing South Asian economies

This paper makes a novel attempt to model the non-linear association between renewable energy consumption and crude oil prices across four net oil-importing South Asian economies namely Bangladesh, India, Pakistan and Sri Lanka. Using annual data from 1990 to 2018, the results from the panel data regression analyses confirm the non-linear nexus and show that although rising crude oil prices do not facilitate renewable energy consumption initially, in the latter phases higher crude oil prices are associated with higher levels of renewable energy consumption. The similar non-linearity is also confirmed in the context of the renewable energy share in total final energy consumption and crude oil prices. Moreover, the nexus between renewable electricity share in aggregate electricity output and crude oil prices is also found to be non-linear in nature. However, rising crude oil prices were not found to enhance the share of renewable electricity. The causality results, overall, implicates that movements crude oil prices do influence the renewable energy transition within the concerned South Asian economies. Thus, these results impose critically important policy implications with respect to attainment of energy security and environmental sustainability across South Asia, particularly via reducing the imported crude oil-dependencies of these nations

Effects of Urbanization on Climate Change: Evidence from Bangladesh

Urbanization is believed to be a driving force of an economy which facilitates the transfer of surplus labor from the rural agricultural sector to the urban industrial sector and contributes to economic development. However, unplanned urbanization can at times boomerang, exerting negative impacts that not only adversely affect the economy but also stimulate environmental degradation. The aim of this paper is to analyze the effects of urbanization on climate change in Bangladesh, a country that has a history of being vulnerable to natural calamities. This paper specifically addresses the effects of urbanization, and other control variables, on emission of selected greenhouse gases and on the average annual temperature change in Bangladesh. Augmented Dickey-Fuller test, Johansen Cointegration test, Vector Error-Correction Model (VECM) causality test, and Granger causality test are conducted in this paper to analyze the data. Moreover, the techniques of Dynamic Ordinary Least Squares (DOLS) and Fully-Modified Ordinary Least Squares (FMOLS) are used to estimate the associated relationships between the variables considered. The causality test results show that urbanization is found to have a causal effect on the greenhouse gas emissions and temperature change in the long run. In contrast, a unidirectional causality is also found to be running from urbanization to carbon dioxide emission in the short run. In light of the regression model estimates it is found that initially urbanization leads to a fall in greenhouse gas emissions and reduces the temperature change, but the relationship eventually gets reversed with time whereby urbanization is found to trigger climate change in Bangladesh. These findings have significant implications for urban planners and policy makers. Keywords: Climate change; Urbanization; Bangladesh

The Fiscal and Current Account Imbalances: An Empirical analysis of the Twin Deficits Hypothesis in Bangladesh

This paper aims to analyze the possibility of the twin deficits hypothesis existing in the context of Bangladesh using annual data from 1980 to 2017. Vector Error-Correction approach is tapped to estimate the short and long run coefficients while the pairwise Granger causality analysis is employed to understand the long run causal associations. The results suggest that budget and current account balances in Bangladesh behave as distant cousins rather than twins as perceived from a reverse causality that is found to be stemming from budget deficit to current account deficit. Moreover, budget deficit is found to deteriorate the national trade balance in Bangladesh

Impacts of Corruption on Sustainable Development: A Simultaneous Equations Model Estimation Approach

The concept of sustainable development epitomizes theoretical frameworks advocating in favor of at least maintaining the rate of development attained in the previous period. Traditionally, development was viewed from a narrow dimension that focused primarily on the development of the economy. However, with time, development has gathered emphasis from a broader perspective incorporating economic, social and environmental welfares into consideration. However, corruption is perceived to be a major factor inhibiting sustainable development all around the globe. The aim of this paper is to shed light on the corruption-sustainable development nexus from the perspective of select 47 countries across Asia, Africa and Latin America and the Caribbean (LAC). The paper attempts to estimate the elasticities of socioeconomic and environmental development indicators with regard to corruption and other macroeconomic fundamentals using annual data from 2000 to 2015. In addition, the paper also tests the Environmental Kuznets’s Curve hypothesis in a panel framework and estimates the threshold levels of income at which the environmental degradation takes place with economic growth. Panel unit root and cointegration tests are used while the Three-Stage Least Squares (3SLS) estimation technique is employed to calculate the associated elasticities. Moreover, in order to check the robustness of the relationships, Panel Vector-Error Correction Model (VECM) and Granger causality test are also considered to understand the short run and long-run causal associations between the variables. In light of the estimated results, corruption is found to have a negative relationship with socioeconomic development across the Asian, African and LAC subpanels. In addition, corruption negatively affects environmental development in the context of the Asian and African subpanels while positively affecting in context of the LAC subpanel. Moreover, the findings also suggest that the EKC hypothesis holds true only in the cases of the full panel and the LAC subpanel, with the threshold per capita GDP being around 12,000 US$and 12,780 US$, respectively. Our paper also finds short run bidirectional causality between corruption and socioeconomic development in the context of all the countries cumulatively which did not hold to be true in the long run. Furthermore, corruption and CO2 emissions portray short bi-directional causality in context of the selected Asian economies and a unidirectional causality running from corruption to CO2 emission for all the economies as a whole