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Pollution haven hypothesis and the environmental Kuznets curve of Bangladesh: an empirical investigation

Author

Listed:
  • Mahamuda Firoj

    (International Islamic University Chittagong (IIUC))

  • Nair Sultana

    (International Islamic University Chittagong (IIUC))

  • Sharmina Khanom

    (International Islamic University Chittagong (IIUC))

  • Md Harun Ur Rashid

    (International Islamic University Chittagong (IIUC))

  • Abeda Sultana

    (Premier University)

Abstract

This study investigated pollution haven hypothesis (PHH) validation and existence of the environmental Kuznets curve (EKC) hypothesis in Bangladesh. The study used CO2 emissions as the key indicator of environmental pollution. Moreover, we considered relevant explanatory variables such as foreign direct investments, trade openness, financial development, gross fixed capital formation, energy consumption and urbanization to achieve our goals. Covering the time series data from 1986 to 2018, the autoregressive distributed lag (ARDL) approach was applied. The findings revealed a long-run cointegration between the considered variables, and the ARDL results cannot validate the PHH in Bangladesh. These results contribute to the existing literature by concentrating on the EKC hypothesis for financial development purposes. Furthermore, we found that urbanization, gross fixed capital formation and trade openness positively influence CO2 emissions, while energy use reduces CO2 emissions. These findings suggest that Bangladesh should take advantage of the invalidity of the PHH and introduce eco-friendly urbanization planning to mitigate detrimental effects of environmental pollution.

Suggested Citation

  • Mahamuda Firoj & Nair Sultana & Sharmina Khanom & Md Harun Ur Rashid & Abeda Sultana, 2023. "Pollution haven hypothesis and the environmental Kuznets curve of Bangladesh: an empirical investigation," Asia-Pacific Journal of Regional Science, Springer, vol. 7(1), pages 197-227, March.
    • Handle: RePEc:spr:apjors:v:7:y:2023:i:1:d:10.1007_s41685-022-00258-3
    DOI: 10.1007/s41685-022-00258-3
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    2. J. C. Sharmiladevi, 2024. "Impact Study of Foreign Direct Investment on Carbon Dioxide Emission, Economic Growth, Trade Openness for India following ARDL Approach," International Journal of Energy Economics and Policy, Econjournals, vol. 14(1), pages 612-619, January.
    3. Muhammad Mehedi Masud & Abu Hanifa Md. Noman & Rulia Akhtar & Sonia Kumari A/P Selvarajan & Abdullah Al‐Mamun, 2024. "Does credit growth mitigate emission intensity in ASEAN countries?," Journal of International Development, John Wiley & Sons, Ltd., vol. 36(2), pages 1324-1349, March.

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    More about this item

    Keywords

    Bangladesh; CO2 emissions; Pollution haven hypothesis; Environmental Kuznets curve;
    All these keywords.

    JEL classification:

    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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