IDEAS home Printed from https://ideas.repec.org/a/gam/jecomi/v12y2024i8p200-d1450463.html
   My bibliography  Save this article

Understanding the Economic Drivers of Climate Change in Southeast Asia: An Econometric Analysis

Author

Listed:
  • Agung Suwandaru

    (School of Business, Western Sydney University, Sydney, NSW 2150, Australia)

  • Widhiyo Sudiyono

    (Faculty of Economics & Business, University of Muhammadiyah Malang, Malang 65144, Indonesia
    Discipline of Business Analytics, The University of Sydney, Sydney, NSW 2006, Australia)

  • Ahmed Shawdari

    (School of Business, Western Sydney University, Sydney, NSW 2150, Australia
    International Relations, Bilateral Relations, Ministry of Finance, Riyadh 11177, Saudi Arabia)

  • Yuntawati Fristin

    (Faculty Social and Political Science, University Merdeka Malang, Malang 65146, Indonesia)

Abstract

This study analyses macroeconomic trends in Southeast Asian countries and their implications for climate change, focusing on urbanisation, GDP per capita, energy intensity, FDI, inflation, and trade. Using panel data from 1970 to 2020, we investigate climate change drivers across Indonesia, Malaysia, the Philippines, Singapore, and Thailand through panel ARDL with PMG and MG analyses, along with Hausman tests. Our results highlight the need for tailored urbanisation policies for sustainability, as the consistent positive correlation between GDPs per capita and emissions, underscores the challenge of decoupling economic growth from emissions. Urbanisation’s varying impact calls for proactive planning, and mixed FDI results suggest nuanced investment approaches aligned with sustainability. Inflation’s negative impact hints at environmental benefits during price increases, necessitating integrated economic and climate policies. The positive relationship between trade openness and emissions emphasises the need for eco-conscious trade agreements to mitigate emissions from industrial activity. Our study stresses the importance of considering macroeconomic heterogeneity in crafting climate policies. Policymakers must adopt multifaceted approaches that prioritise sustainability across economic growth, energy efficiency, technology adoption, and trade to balance development with environmental preservation. This approach enables Southeast Asian countries to contribute effectively to global climate change mitigation.

Suggested Citation

  • Agung Suwandaru & Widhiyo Sudiyono & Ahmed Shawdari & Yuntawati Fristin, 2024. "Understanding the Economic Drivers of Climate Change in Southeast Asia: An Econometric Analysis," Economies, MDPI, vol. 12(8), pages 1-21, August.
    • Handle: RePEc:gam:jecomi:v:12:y:2024:i:8:p:200-:d:1450463
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2227-7099/12/8/200/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2227-7099/12/8/200/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Martínez-Zarzoso, Inmaculada & Maruotti, Antonello, 2011. "The impact of urbanization on CO2 emissions: Evidence from developing countries," Ecological Economics, Elsevier, vol. 70(7), pages 1344-1353, May.
    2. Cemal Atici, 2022. "Reconciling the flexibility mechanisms of climate policies towards the inclusiveness of developing countries: commitments and prospects," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(7), pages 9048-9067, July.
    3. M. Hashem Pesaran, 2007. "A simple panel unit root test in the presence of cross-section dependence," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(2), pages 265-312.
    4. Kao, Chihwa, 1999. "Spurious regression and residual-based tests for cointegration in panel data," Journal of Econometrics, Elsevier, vol. 90(1), pages 1-44, May.
    5. Maximilian Konradt & Beatrice Weder, 2023. "Carbon Taxation and Greenflation: Evidence from Europe and Canada," Journal of the European Economic Association, European Economic Association, vol. 21(6), pages 2518-2546.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jingqi Sun & Jing Shi & Boyang Shen & Shuqing Li & Yuwei Wang, 2018. "Nexus among Energy Consumption, Economic Growth, Urbanization and Carbon Emissions: Heterogeneous Panel Evidence Considering China’s Regional Differences," Sustainability, MDPI, vol. 10(7), pages 1-16, July.
    2. Jin, Taeyoung, 2022. "The evolutionary renewable energy and mitigation impact in OECD countries," Renewable Energy, Elsevier, vol. 189(C), pages 570-586.
    3. Liddle, Brantley, 2015. "What Are the Carbon Emissions Elasticities for Income and Population? Bridging STIRPAT and EKC via robust heterogeneous panel estimates," MPRA Paper 61304, University Library of Munich, Germany.
    4. Sofien Tiba & Musavir Ul Habib, 2024. "Examining the Causal Linkages Between Nuclear Energy, Environment, and Economic Growth: An Application from the SAARC Economies," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(2), pages 9699-9722, June.
    5. Liddle, Brantley & Sadorsky, Perry, 2017. "How much does increasing non-fossil fuels in electricity generation reduce carbon dioxide emissions?," Applied Energy, Elsevier, vol. 197(C), pages 212-221.
    6. Iheonu O Chimere & Tochukwu Nwachukwu, 2020. "Macroeconomic determinants of household consumption in selected West African countries," Economics Bulletin, AccessEcon, vol. 40(2), pages 1596-1606.
    7. Herzer Dierk, 2022. "Semi-endogenous Versus Schumpeterian Growth Models: A Critical Review of the Literature and New Evidence," Review of Economics, De Gruyter, vol. 73(1), pages 1-55, April.
    8. Emmanuel Anyigbah & Yusheng Kong & Bless Kofi Edziah & Ahotovi Thomas Ahoto & Wilhelmina Seyome Ahiaku, 2023. "Board Characteristics and Corporate Sustainability Reporting: Evidence from Chinese Listed Companies," Sustainability, MDPI, vol. 15(4), pages 1-26, February.
    9. Dongwon Lee & Yu-chin Chen, 2014. "What Makes a Commodity Currency?," Working Papers 201420, University of California at Riverside, Department of Economics.
    10. Mehmet Balcilar & Daberechi Chikezie Ekwueme & Hakki Ciftci, 2023. "Assessing the Effects of Natural Resource Extraction on Carbon Emissions and Energy Consumption in Sub-Saharan Africa: A STIRPAT Model Approach," Sustainability, MDPI, vol. 15(12), pages 1-23, June.
    11. Hosan, Shahadat & Rahman, Md Matiar & Karmaker, Shamal Chandra & Saha, Bidyut Baran, 2023. "Energy subsidies and energy technology innovation: Policies for polygeneration systems diffusion," Energy, Elsevier, vol. 267(C).
    12. Muhammad Shahbaz & Syed Jawad Hussain Shahzad & Mantu Kumar Mahalik & Perry Sadorsky, 2018. "How strong is the causal relationship between globalization and energy consumption in developed economies? A country-specific time-series and panel analysis," Applied Economics, Taylor & Francis Journals, vol. 50(13), pages 1479-1494, March.
    13. Zhonghua Cheng & Xiaowen Hu, 2023. "The effects of urbanization and urban sprawl on CO2 emissions in China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(2), pages 1792-1808, February.
    14. Eleni Sardianou & Vasilis Nikou & Ioannis Kostakis, 2023. "Harmonizing Sustainability Goals: Empirical Insights into Climate Change Mitigation and Circular Economy Strategies in Selected European Countries with SDG13 Framework," Sustainability, MDPI, vol. 16(1), pages 1-16, December.
    15. Relwendé Sawadogo, 2021. "The relationship between insurance and banking sectors in Sub-Saharan African: Does globalization matter?," Economic Change and Restructuring, Springer, vol. 54(1), pages 101-119, February.
    16. Dierk Herzer, 2024. "A panel data analysis of the long-run effect of environmental taxes on R&D expenditures at the macro-level," Economics Bulletin, AccessEcon, vol. 44(3), pages 1169-1180.
    17. Polemis, Michael & Tselekounis, Markos, 2019. "Does deregulation drive innovation intensity? Lessons learned from the OECD telecommunications sector," MPRA Paper 92770, University Library of Munich, Germany.
    18. Ronghui Xie & Shengjie Zhang, 2024. "Re†examining the impact of global foreign direct investment (FDI) inflows on haze pollution—considering the moderating mechanism of environmental regulation," Energy & Environment, , vol. 35(6), pages 3186-3209, September.
    19. Mathilde Aubry & Jean Bonnet & Patricia Renou-Maissant, 2015. "Entrepreneurship and the business cycle: the “Schumpeter” effect versus the “refugee” effect—a French appraisal based on regional data," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 54(1), pages 23-55, January.
    20. Hussein Moghaddam & Robert M. Kunst, 2023. "The Role of Natural Gas in Mitigating Greenhouse Gas Emissions: The Environmental Kuznets Curve Hypothesis for Major Gas-Producing Countries," Sustainability, MDPI, vol. 15(5), pages 1-20, February.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jecomi:v:12:y:2024:i:8:p:200-:d:1450463. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.