Towards sustainable growth: The role of trade openness and urbanization in Türkiye's energy-driven environmental challenges

Abstract

This manuscript investigates the interplay between energy dynamics, economic growth, and environmental sustainability, offering a comprehensive analysis of Türkiye's long-term ecological and economic trends. In this sense, the research elaborates the long-run linkage among natural gas import, energy usage, economic growth, trade openness, urbanization and ecological footprint (EF) by implementing the Johansen cointegration test, fully modified ordinary least squares (FMOLS) analysis, nonlinear distributed lag autoregressive model (NARDL) model, and wavelet analyses from 1980 to 2022 for Türkiye. Furthermore, when the contributions and novelties of this paper to the existing academic literature are considered, time series models comprehending the Johansen cointegration test, FMOLS analysis, and NARDL model point out the long-run relationship between natural gas import, economic growth, and EF, which is confirming the Environmental Kuznets Curve hypothesis for Türkiye in short term. Considering the coefficients of the FMOLS model, 1% increases in gross domestic product increases EF by 0.1972% and a 1% increase in natural gas import increases EF by 0.0369% as negatively. In addition, according to FMOLS test, it should be stated that a 1% increase in energy use increases EF by 0.7600%. When all remaining independent variables are examined deeply and thoroughly, there is a long-term positive effect between them. Empirical findings reveal that natural gas imports (p = .0428) and energy consumption (p < .0001) are major contributors to ecological degradation. Conversely, urbanization (p = .3999) demonstrates potential for mitigating environmental pressure in the long term. The study highlights the need for transitioning to renewable energy, enhancing energy efficiency, and adopting sustainable urban development practices. These findings emphasize the importance of aligning economic growth with ecological sustainability through targeted policy interventions. Unlike previous studies that predominantly concentrate on renewable energy with CO₂ emissions, this paper dissimilarly highlights the overlooked environmental effects of natural gas imports. These insights not only expand the understanding of Türkiye's energy and environmental dynamics but also challenge the common perception of natural gas as an eco-friendly energy source. To sum up, the research includes empirical results which patronizes the necessity for a transition to renewable resources and cleaner technologies to mitigate environmental costs.