How do income inequality, poverty and industry 4.0 affect environmental pollution in South Asia: New insights from quantile regression

Abstract

While many factors have been studied as potential causes of environmental degradation, the impact of poverty and inequality has been largely overlooked in the research. The Sustainable Development Goals are aligned with the intersection of poverty, inequality, and the environment. In addition, most previous research has used carbon dioxide (CO2) emissions as a surrogate for pollution. These gaps are filled by this study, which uses ecological footprint (a comprehensive measure of pollution) and CO2 emissions to examine the effects of income disparity and poverty on environmental pollution in 13 nations. Dynamic panel Quantile regression methods are used in this study because of their resilience to various econometric problems that can crop up during the estimate process. The empirical results reveal that the whole panel's carbon emissions and ecological footprint rise when income disparity and poverty exist. When the panel is subdivided, however, we see that income inequality reduces carbon emissions and environmental footprint for the wealthy but has the opposite effect on the middle class. While high-income households see no impact from poverty on their carbon emissions, middle-income households see an increase in both. Overall, the results of this study suggest that income disparity and poverty are major factors in ecological degradation. Therefore, initiatives to reduce environmental degradation should pay sufficient attention to poverty and inequality to achieve ecological sustainability.