Globalization and Pollution in Central and Eastern European EU Countries

Abstract

Pollution and globalization are current challenges for Central and Eastern Europe (CEE), especially in the context of negative effects of globalization on environment. The aim of this paper is to assess the impact of globalization index on CO2 emissions in the CEE countries that joined the EU in the period 2005-2021. The results based on a panel data approach with DOLS/FMOLS estimators confirm the hypothesis that globalization enhances pollution in this region, but a non-linear relationship was validated between CO2 emissions and globalization index. After reaching a maximum level, the CO2 emissions begin to decrease, while globalization enhances. On the other hand, economic freedom and electricity prices in household consumers had a positive impact on pollution. Renewable energy consumption has the capacity to reduce pollution, while higher electricity prices for non-household users discourage economic activities, which contribute to environmental protection. These empirical findings could support policy proposals to reduce pollution in this region.