Nexus between Agricultural Land Use, Economic Growth and N2O Emissions in Canada: Is There an Environmental Kuznets Curve?

Abstract

The present study investigates the relationship between nitrous oxide emissions and economic growth using the ARDL bounds testing approach in Canada over the period of 1970–2020. The agricultural land use and exports are included in the estimated models as additional control variables. The empirical findings confirmed the environmental Kuznets curve hypothesis when total N2O emissions are used as a dependent variable in the case of Canada, and similar results are found when we used agricultural induced N2O emissions as a dependent variable. The results also indicate that Canada is already in the decreasing segment of the Kuznets curve, and the turning point of GDP per capita for the total N2O emissions is $41,718, while for agricultural induced N2O emissions, it is $38,825. Our empirical evidence confirms that agricultural land use had a positive and significant effect on total N2O emissions, while a negative but insignificant effect in the case of agricultural induced N2O emissions. However, Canadian exports are negatively associated with total N2O emissions as well as agricultural induced N2O emissions, but it requires more stringent laws to curb N2O emissions-oriented exports to keep the ecosystem in balance in the short-run and intends to meet its long-term target of reducing emissions as it progresses towards Canada’s 2050 net-zero ambition.