Effects of tourism and eco-innovation on environmental quality in selected ASEAN countries.

Abstract

Environmental issues have gained the attention of regulators and researchers worldwide. This present study empirically examines the validation of the environmental Kuznets curve (EKC) in the selected ASEAN economies for the period 1995–2018 in the presence of eco-innovations and tourism. This study assesses the short-run and long-run relationship between carbon dioxide emission, tourism, eco-innovations, and economic growth in ASEAN countries. To fulfil the objectives of the study, Westerlund and Edgerton (Oxf Bull Econ Stat 70:665-704, 2008) and Banerjee and Carrion‐i‐Silvestre (J Time Ser Anal 38:610-636, 2017) co-integration analysis have been applied to estimate the co-integration among variables because cross-sectional dependence (CSD) and slope heterogeneity was present. The short-run and the long-run empirical estimation have been done through cross-sectional auto distributive lag model. The findings provide evidence that an inverted U-shape nexus exists between carbon (CO2) emissions and economic growth in the ASEAN countries, a validation of EKC. Eco-innovations and tourism are found to be the factors that mitigate CO2 emissions. AMG and CCEMG results also confirm the robustness of short-run and long-run results. The findings of the study suggest that governments in ASEAN countries should promote tourism and eco-innovations (i.e., research and development) to mitigate CO2 emission, which poses serious threats to environmental sustainability. Also, tourism and eco-innovations are the drivers of economic growth, and growth reconciles with environmental sustainability in the selected ASEAN countries. This study provides guidelines to the policymakers while formulating the regulations related to environmental degradation.