Dynamic common correlated effects of trade openness, FDI, and institutional performance on environmental quality: evidence from OIC countries

The study aims to address the dynamic common correlated effects of trade openness, FDI, and institutional performance on environmental quality in OIC countries. Mostly, pollutants like CO 2 and SO 2 emissions are considered as the environmental indicators. However, for this study, we have selected e...

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Bibliographic Details
Published in:Environmental science and pollution research international 2020-04, Vol.27 (11), p.11671-11682
Main Authors: Ali, Sajid, Yusop, Zulkornain, Kaliappan, Shivee Ranjanee, Chin, Lee
Format: Article
Language:English
Subjects:
Aquatic Pollution
Atmospheric Protection/Air Quality Control/Air Pollution
Carbon Dioxide
Clean technology
Cross-Sectional Studies
Cross-sections
Dependence
Earth and Environmental Science
Ecological footprint
Econometrics
Economic Development
Ecotoxicology
Environment
Environmental Chemistry
Environmental Health
Environmental impact
Environmental indicators
Environmental quality
Environmental science
Footprint analysis
Foreign investment
Pollutants
Research Article
Sulfur dioxide
Sustainable development
Urbanization
Waste Water Technology
Water Management
Water Pollution Control
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Summary:The study aims to address the dynamic common correlated effects of trade openness, FDI, and institutional performance on environmental quality in OIC countries. Mostly, pollutants like CO 2 and SO 2 emissions are considered as the environmental indicators. However, for this study, we have selected ecological footprint as the indicator of environmental quality. The new econometric approach Dynamic Common Correlated Effects (DCCE) by Chudik and Pesaran ( 2015 ) has been used to measure the cross-sectional dependence among cross-sectional units. Results confirm that previous techniques for long panel data, like MG and PMG, give ambiguous outcomes in the presence of cross-sectional dependence. According to DCCE estimation, trade openness, FDI, and urbanization have a positive and significant relationship with ecological footprint while a significant and negative association is found between institutional performance and ecological footprint. The OIC countries must encourage green technology, clean production, and improved institutions for sustainable development and better environmental quality.
ISSN:0944-1344
1614-7499
DOI:10.1007/s11356-020-07768-7