Pooled mean group estimation of an energy-globalization-emissions nexus: Evidence from the selected South- and South-East Asian countries

Abstract

Although globalization is widely credited for unprecedented global economic growth, it also bears responsibility for climate change. Today, the primary emphasis of contemporary research is to find ways that help to reduce climate change adversaries without compromising the globalization-led economic development agenda. Thus, this study takes the case of 12 emerging economies selected based on their emissions profile and vulnerability to climate change. Covering annual data from 1972 to 2018, this study accounts for globalization's economic, social, and political aspects and empirically tests their relationship with carbon footprints and energy demand in the panel countries. The results confirm the long-run equilibrium relationship among all the underlying variables and find that economic globalization significantly contributes to energy demand and carbon emissions. However, such an effect can be overcome through social globalization. Whereas political globalization reduces the energy demand but spurs carbon emissions. Our results rule out the ant-globalization narrative and support pro-globalization chronicles for sustainable development policy agenda in emerging economies. We suggest that the emerging countries that are mainly facing the decision dilemma to choose between sustainable economic growth and a sustainable environment, are better off if they equally integrate socially and politically with the global economy. Moreover, the model is checked for robustness using FMOLS and found validated. It warrants that the results are appropriate for policy control use.