Does globalization augment environmental degradation through the channel energy and FDI? Evidence from BRI initiatives

Abstract

From 2000 through 2020, this study examines the impacts of FDI, economic development, and globalization on E.D. in a sample of Belt and Road Initiative (BRI) nations. Data for the inquiry is gathered using a variety of tests, including the Westerlund cointegration test, the Dynamic seemingly unrelated regression (DSUR) long-run panel estimate approach, and the Dumitrescu-Hurlin panel causality test. Panel unit root tests reveal which variables are hidden where and after initial difference and long-run association documents have been processed using conventional and error-correcting methods. DSUR discovered a positive relationship between long-term energy use and environmental degradation, implying that greater energy consumption and total output would exacerbate the current condition of environmental degradation. Foreign direct investment (FDI), financial expansion, and globalization benefit the global economy more than harm the environment. Aside from the unidirectional impacts of financial development, globalization, and economic expansion on environmental degradation, directional causality studies demonstrate the presence of a feedback hypothesis that helps to explain these causal relationships. This research demonstrates the need for Belt and Road (B.R.) energy measures to improve energy efficiency.