The Long Run Dynamics of Sustainable Economic Development on Ecological Footprint in Developed and Developing Countries: Panel Quantile Regression

Abstract

Rapid human consumption increases natural resource consumption, which damages the environment. The present study links sustainable economic development and Ecological Footprint in 78 developing and 93 developed countries from 1990 to 2020. This study measures sustainable economic development using the Human Development Index (HDI). The study uses panel quantile regression (PQR) to analyze data from the lower, middle, and higher ecological footprint groups. The study concluded that in developed countries with lower ecological footprint groups, a U-shaped relationship exists while in higher ecological footprint groups the inverted U-shaped EKC is valid between ecological footprint and HDI. It shows that developed countries initially degrade the environment by increasing their ecological footprint. Furthermore, as these countries grow, they divert their attention to more environmentally friendly technologies, resulting in a declining ecological footprint. However, developing countries demonstrate a U-shaped relationship in all quantile groups, indicating that these countries are prioritizing economic growth over environmental concerns. This study recommends that developing countries should follow the developed countries to reduce their ecological footprint by using environmentally friendly practices.