Assessing the environmental consequences of fossil fuel consumption in newly industrialized countries

Abstract

Purpose This study aims to examine the environmental impact of fossil fuel use in newly industrialized countries (NICs), focusing on the relationship between economic growth, energy consumption and environmental sustainability from 1971 to 2020. Design/methodology/approach The research uses pool mean group autoregressive distributive lag, fully modified ordinary least squares and dynamic ordinary least squares econometric models to analyze long-run data. These methods enable a detailed assessment of how economic and industrial factors affect environmental pollution. Findings The study finds that nonrenewable energy consumption is positively linked to environmental pollution, with a 1% increase leading to a 6.25% rise in pollution. Industrialization, urbanization and globalization also significantly increase pollution, with increments of 2.51%, 3.97% and 2.11%, respectively. Conversely, economic growth has a beneficial effect, reducing pollution by 2.59% for every 1% increase in growth. Practical implications Policymakers should balance economic growth with environmental sustainability by reducing nonrenewable energy consumption and supporting renewable energy adoption. Originality/value This research provides fresh insights into the dynamics between economic growth and environmental pollution in NICs. By using advanced econometric techniques over an extended period, it offers a view of how economic and industrial activities influence environmental outcomes, highlighting the dual role of economic growth in both promoting development and reducing pollution.