Document Type : Research Paper
Author
Ph.D. in Public Sector Economics, Department of Economics, Faculty of Economics and Administrative Sciences, Lorestan University, Khoram Abad, Iran
Abstract
EXTENDED ABSTRACT
INTRODUCTION:
Concerns about climate change have increased over the past years.The escalating energy demands of the world's population, coupled with a reliance on fossil fuels, have resulted in environmental degradation and global warming, which is now a top priority on the international agenda. Although a growing number of countries have pledged to achieve net zero emissions by 2050, many nations have increased their reliance on coal, oil, and natural gas due to the global energy crisis and rising energy prices. As a result, environmental degradation has been affected by the use of natural resources. The MENA region is the focus of this issue due to having huge energy resources and it is worth mentioning that this region has shown a higher growth in carbon emissions per capita than GDP per capita. natural resources have the potential to degrade environmental sustainability if they are used for boosting current economic welfare by increasing consumption instead of increasing future welfare by investing in capital assets and infrastructure. On the contrary, some researchers asserted that natural resource use may not be detrimental to environmental sustainability as is envisaged, and shifts in natural resource use patterns can positively influence environmental sustainability. Moreover, natural resource abundance can increase natural resource revenues, which can be used for capital formation and infrastructure investment. Thus, the economic growth level in a given country can increase, and a higher development level could foster shifting to better technologies, advanced environmental regulations, and structural change in an economy. Hence, environmental destruction can be reduced. Therefore, the literature has different perspectives on the ecological and welfare impacts of natural resources. In this regard, the main purpose of this research is to investigate the effect of the rent of various natural resources on the environmental load capacity factor (LCF) in selected countries of the MENA region during the years 2000-2022. As a new and comprehensive indicator of environmental sustainability, LCF considers both the supply and demand sides of the ecosystem and its higher values indicate greater environmental sustainability. LCF is obtained by dividing the biological capacity by the ecological footprint, and the MENA region countries do not have a good situation regarding this index.
METHODOLOGY:
The empirical model of this study is framed within the Stochastic Impacts by Regression on Population, Affluence, and Technology model (STIRPAT). The data used are real gross domestic product (GDP), natural resources rent and its types, population density, renewable energy consumption, and LCF. Data on GDP (per capita, constant 2015 dollars), natural resources rent and its types (% GDP), population density (people per sq. km of land area) and renewable energy consumption (% total final energy consumption) were obtained from the World Bank. Data on biological capacity (per capita, gha) and ecological footprint (per capita, gha) are taken from the Global Footprint Network. The fundamental statistical tool for determining average effects is classical regression analysis. The classical regression analysis is based on the notion that the coefficient effects remain constant across the population. Quantile Regression (QR) with fixed effects is used in this study to rigorously investigate the dynamic relationships between Model variables.
FINDINGS:
Rresults of the estimation model in the framework of LCC indicate that, at the total level, the natural resource rent at all levels of environmental sustainability (except the middle levels) had a small and significant positive impact on LCF, and the average change in the dependent variable is more in countries with higher levels of environmental sustainability. At the disaggregated level, in the high levels of environmental sustainability, natural gas rent, and forest rent have a positive and significant impact, and mining rent has a negative and significant impact on LCF. Meanwhile, oil rent does not significantly impact LCF at all levels of environmental sustainability (except the medium level). Also, the LCC hypothesis is not rejected as a U-shaped relationship between economic growth and LCF in countries with medium and low levels of environmental sustainability. Based on other results, population density at all levels of environmental sustainability and renewable energy consumption at high levels of environmental sustainability had a negative (and significant) and positive (and significant) impact on LCF, respectively.
CONCLUSION:
In this study, by using a STIRPAT model in the field of factors affecting the environment quality and its empirical test through co-integration analysis with cross-sectional dependence and the quantile panel regression method, the relationship between the rent of natural resources and its types with environmental sustainability indicator has been investigated in the framework of the load capacity curve hypothesis (LCC). The results of this research show that natural resource rent is not only a threat to environmental sustainability in MENA countries, but it can also help to improve the level of environmental sustainability in these countries. However, it seems that the studied countries do not adopt the necessary and appropriate policies regarding environmental management, technology, and standards for the production and consumption of natural resources, which has led to the small effect of natural resource rent on environmental sustainability in the countries of the MENA region, and it seems which is far from the optimal level of its effectiveness. Therefore, these countries must promote environmentally friendly methods of exploration and extraction of natural resources using advanced technologies in line with the principles of sustainable development.
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