Mitigating Transport-Based CO2 Emissions in Landlocked Countries: The Role of Economic Growth, Trade Openness, Freight Transportation and Renewable Energy Consumption

The transportation sector plays a pivotal role in economic development but is also a major contributor to environmental degradation due to its reliance on fossil fuels. This study explores the relationship between transport-related CO2 emissions, economic growth, road and rail freight transport, industry, trade openness, fossil fuel consumption, financial development, and renewable energy in 11 landlocked countries from 1990 to 2022. Using panel co-integration tests and PMG-ARDL techniques, the findings reveal a bidirectional causality between CO2 emissions, road freight, financial development, and industry. Road freight transport significantly boosts economic growth but also intensifies emissions, while renewable energy effectively mitigates transport-related CO2. The results emphasize the need for policymakers to balance economic advancement with sustainable energy and emission reduction strategies. Achieving economic-energy sustainability is essential for fostering a green and clean environment without compromising growth

Publisher Summary This chapter discusses the financial development and economic growth in underdeveloped countries. An observed characteristic of the process of economic development over time, in a market-oriented economy using the price mechanism to allocate resources, is an increase in the number and variety of financial institutions and a substantial rise in the proportion not only of money but also of the total of all financial assets relative to GNP and to tangible wealth. Typical statements indicate that the financial system somehow accommodates—or, to the extent that it malfunctions, it restricts—growth of real per capita output. Such an approach places emphasis on the demand side for financial services; as the economy grows it generates additional and new demands for these services, which bring about a supply response in the growth of the financial system. In this view, the lack of financial institutions in underdeveloped countries is simply an indication of the lack of demand for their services.

PurposeThe primary objective of this research is to assess the influence of financial development, institutional quality and renewable energy consumption on India’s carbon emissions.Design/methodology/approachThis study utilises econometric methodologies, specifically the autoregressive distributed lag (ARDL) model and Toda–Yamamoto causality tests, to explore the interplay among renewable and non-renewable energy consumption, financial development, economic growth, institutional quality, trade openness and carbon emissions in India spanning the years 1996–2019.FindingsThe research indicates that in India, greater utilisation of renewable energy, enhanced financial development and improved institutional quality are linked to lower carbon emissions. On the contrary, an escalation in carbon emissions is related to the consumption of non-renewable energy and greater trade openness. The Toda–Yamamoto causality tests reveal one-way causal relationships from institutional quality, financial development, non-renewable energy consumption and economic growth to CO2 emissions. Furthermore, the study identifies reciprocal causation, demonstrating that carbon dioxide emissions influence renewable energy consumption and trade openness.Research limitations/implicationsThis study recommends that forthcoming research expand its focus by integrating more comprehensive indicators such as consumption, production, transport-based CO2 emissions or ecological footprint. Additionally, to bolster the rigour of future inquiries, researchers might consider exploring alternative regression analysis methods like NARDL and STAR.Originality/valueThis study addresses a significant gap in the existing literature by being the first empirical investigation into the effects of renewable energy consumption, institutional quality and financial development on carbon emissions in the Indian economy. Unlike prior research, we consider a comprehensive financial development and institutional quality index, providing a more holistic perspective. This unique approach contributes valuable insights into the environmental challenges faced by the Indian economy, offering a nuanced understanding of the complex dynamics of environmental degradation in this region.

Carbon emissions growth and road freight: Analysis of the influencing factors in Tunisia

This chapter assesses the environmental impacts of increased international road and rail freight transport – focussing on air emissions and noise. It gives an overview of major trends and of the main drivers behind them. In addition, this chapter briefly discusses the main technical and non-technical measures for tackling the increasing environmental impacts. The chapter explores the developments in emission factors of road and rail vehicles, particularly the standards for reducing pollutant emissions and the differences among the emissions of the various modes. In the last decades, there has been increasing evidence that emissions of greenhouse gas contributes to the effect of global warming; the emissions of carbon dioxide (CO2) from the burning of fossil fuels is a major contributor. For the transport sector, greenhouse gas emissions are dominated by the CO2 emissions from burning fossil fuels. The CO2 emissions of international road freight transport are increasing all over the world, and there is not yet a sign that this trend is to be curbed soon. The chapter looks at impacts from pollutant emissions on various problems related to air quality (health, building and material damages, crops and ecosystems), and at health and nuisance impacts from noise. A mix of measures, like increased motor fuel taxes, stricter fuel efficiency standards for vehicles, promotion of alternative fuels and logistical improvements, is needed.

The renewable energy-economic growth-environment nexus has been generally considered an important puzzle that needs to be addressed for the following phrases of sustainable economic growth and development globally. The existing literature confirms the potential role of trade openness, financial development, and urbanization in this nexus. However, these roles have largely been ignored in empirical studies. This study uses the second-generation macro econometrics regarding panel unit root tests, cointegration tests, long-run estimations, and Granger homogeneous non-causality tests to investigate these impacts on the important nexus. First, the findings reveal that economic growth increases CO2 emissions, whereas renewable energy usage supports economic growth and mitigates CO2 emissions. There appears to be a bidirectional causality relationship between renewable energy and economic growth, which Granger-cause CO2 emissions unidirectionally. Second, trade openness increases CO2 emissions and renewable energy usage. We also find that financial development positively contributes to economic growth, whereas urbanization has no impact on the nexus in the long run. Third, trade openness Granger causes economic growth bidirectionally, and unidirectional causality from financial development to economic growth and CO2 emissions is found. Our results confirm a bidirectional causality relationship between urbanization, economic growth, and CO2 emissions and a unidirectional causality relationship from renewable energy to urbanization. Policy implications have emerged for countries globally, including emerging markets, which are the main emitters. Increased renewable energy supply and usage in total energy and extended financial systerms will sustain economic development and limit CO2 emissions.

The relationship between economic growth and transport sector is an important and popular topic for researchers, but it also has several untapped areas. To ensure continuous economic growth, it is necessary to answer how and to what extent economic sectors contribute to sustainability; what factors or sets of factors can determine freight performance in a country or region; and how it affects the global economy. This study aims to test the presence of spatial dependence. In this research, the authors looked for the spatial relationships between economic activity (GDP) and freight transport performance using spatial econometric models. The results showed that the spatial impact of freight transport performance and GDP significantly influence each other. The intensity calculation shows that the Baltic States have a high intensity in road freight transport, followed by the Central European region. Eastern Europe, including Russia and the Baltics, are prominent players in rail freight. Furthermore, the spatial econometric models have highlighted that a country with high GDP has some sort of "suction" effect on neighbouring countries with lower GDP along with the freight performance. This is especially true for rail freight. In the long run, the outlined results may even support strategic decision-makers in managing the economic impacts of both road and rail freight transport at the regional level.

PurposeThe development of green economy is of academic and policy importance to governments and policymakers worldwide. In the light of the necessity of renewable energy to sustain green economic growth, this study aims to examine the relationship between renewable energy consumption and green economic growth, controlling for the impact of trade openness for Organization for Economic Co-operation and Development countries over the period 1990-2015, within a multivariate panel data framework.Design/methodology/approachTo investigate the long-run relationship between variables, panel cointegration tests are performed. Panel Granger causality based on vector error correction models is adopted to understand the short- and long-run dynamics of the data. Furthermore, ordinary least square (OLS), dynamic OLS and fully modified OLS methods are used to confirm the long-run elasticity of green growth for renewable energy consumption and trade openness. Moreover, system generalized method of moment is applied to eliminate serial correlation, heteroscedasticity and endogeneity problems. The authors used the panel Granger causality test developed by Dumitrescu and Hurlin (2012) to infer the directionality of the causal relationship, allowing for both the cross-sectional dependence and heterogeneity.FindingsThe results suggest that renewable energy consumption and trade openness exert positive effects on green economic growth. The results of long-run estimates of green economic growth reveal that the long-run elasticity of green economic growth for trade openness is much greater than for renewable energy consumption. The estimated results of the Dumitrescu and Hurlin (2012) test reveal bidirectional causality between green economic growth and renewable energy consumption, providing support for the feedback hypothesis.Practical implicationsThis paper provides strong evidence of the contribution of renewable energy consumption on green economy for a wide range of countries. Despite the costs of establishing renewable energy facilities, it is evident that these facilities contribute to the green growth of an economy. Governments and public authorities should promote the consumption of renewable energy and should have a support policy to promote an active renewable energy market. Furthermore, the regulators must constitute an efficient regulatory framework to favor the renewable energy consumption.Social implicationsMany countries focus on increasing their GDP without taking the environmental impacts of the growth process into account. This paper shows that renewable energy consumption points to the fact that countries can still increase their economic growth with minimal damage to environment. Despite the costs of adopting renewable energy technologies, there is still room for economic growth.Originality/valueThis paper provides evidence on the contribution of renewable energy consumption on green economic growth for a wide range of countries. The paper focuses on the impact of renewable energy on economic growth by taking environmental degradation into consideration on a wide scale of countries.

Environmental problems such as climate change have brought to light the necessity of implementing more stringent environmental regulations and expanding the use of renewable energy sources in order to protect the environment and maintain a green ecosystem. As a result, this study aims to investigate the impact of China’s financial development and consumption of renewable energy on the country’s environmental quality from 2009 to 2019. Following the application of the ARDL method, this research begins by employing the NARDL (non-linear autoregressive distributive lag) model in order to analyze the asymmetry in the data that results from the presence of either positive or negative aspects of financial development. The results of the NARDL bound test indicate that the variables are long-term co-integrated. This enables the application of the ARDL methodology. The ARDL bound test findings show a positive relationship that exists over the long-term between financial development, trade openness, renewable energy consumption, economic growth, and CO2 emissions. In addition, the error correction model (ECM) provides evidence that there is, at least in the short run, a connection between CO2 emissions, financial development, economic growth, and energy consumption. Furthermore, according to a dynamic multiplier graph, the positive aspect of financial development has a greater influence on carbon emissions for a longer time than the shocks associated with a less favorable financial development. According to the findings, there does not appear to be any asymmetry between CO2 emissions and financial development, which supports the idea that both the positive and negative aspects of financial development have an equally significant impact.

Impacts of truck platooning on the multimodal freight transport market: An exploratory assessment on a case study in Italy

The paper analyses the causal relationship between economic growth, renewable energy consumption, trade openness, and CO₂ emissions using a sample of 13 countries from 2006 to 2021. The JKS Granger non-causality test is applied. The results of the analysis show a bidirectional relationship between economic growth and CO₂ emissions. Additionally, there is a two-way causal relationship between CO₂ emissions and renewable energy consumption. Trade openness causes an increase in CO₂ emissions, but emissions do not, in turn, cause trade openness. This may be explained by the increasing role of renewable energy sources in offsetting fossil fuel dependence, while trade openness, particularly in developing economies, often leads to greater industrial activity and energy consumption, which in turn raises emission levels. The study highlights the interrelated nature of CO₂ emissions, economic growth, renewable energy use, and trade openness, emphasising the importance of coordinated policies for achieving carbon reduction and sustainable development. These findings offer valuable insights for policymakers aiming to design balanced strategies for energy transition and environmental protection.

Symmetric and asymmetric impact of economic growth, capital formation, renewable and non-renewable energy consumption on environment in OECD countries

A significant obstacle to the scaling of renewable energy is the concern that increased consumption of renewable energy could have a negative impact on economic growth, due to the higher cost of renewable energy compared to fossil energy. To examine how exactly renewable energy consumption impacts economic growth, this study uses a non-linear panel threshold model with trade openness, financial development, and per capita income as threshold variables, to analyze the long-term non-linear relationship between renewable energy consumption and economic growth in 28 European Union countries from 2007 to 2017. The results show that (i) renewable energy consumption has significant threshold effect on economic growth. First, the effect of renewable energy consumption on economic growth is positive and significant if and only if it surpasses a certain threshold of trade openness. Second, a moderate financial development interval makes the consumption of renewable energy have a positive effect on economic growth, and if it is too low or too high, it will have a negative effect. Third, as for income level, the promoting effect of renewable energy consumption on economic growth is showing a "stepwise growth" feature, which means, when the income level surpasses its threshold value, the positive effect is strengthened. (ii) The results of the fixed-effects model show that, overall, renewable energy consumption promotes economic growth. (iii) The changes in the number of countries in different threshold intervals indicate that the positive impact of renewable energy consumption on economic growth in the EU is increasing.

The increase in the number of freight vehicles on South Africa’s rural road network has received substantial attention. Insinuations persist that long-distance road freight haulage is of a somewhat unsavoury economic nature, and that strict economic re-regulation of the land freight transport is necessary. During the 1970s road transport replaced rail carriage as the dominant form of long-distance freight transport (excluding minerals and ore) in South Africa. On long hauls road freight carriers transport certain primary products of an organic nature (such as timber, fish and agricultural produce), some semi-finished goods, many finished goods and most consumer goods. Road freight carriers are continuously gaining market share on long-distance links where rail transport is the more cost efficient mode. The greater value added by road freight carriers in comparison with rail transport through service effectiveness is often more than the cost premium paid for utilising their service rather than making use of rail transport. Throughout history, governments have involved themselves in transport. A diverse range of arguments have been advanced for this involvement in transport, including the following:Control of excessive competition, co-ordination of transport, integration of transport with economic policy, maintenance of safety, security, and order, provision of costly infrastructure, provision of public goods, recovery of the true resource cost of transport inputs, regulation of harmful conduct and externalities, restraint of monopoly power, and social support. A set of nine instruments can be identified that governments apply to influence the performance of the freight transport industry: Legislation, direct supply, fiscal measures, monetary measures, moral appeal and persuasion, policies relating to strategic commodities, procurement policy, provision of information, and research and development. The best prospects for a sound development of land freight transport activity in South Africa will be offered within the framework of a free-functioning freight transport market.

The role of international tourism, trade openness and renewable energy in the financial development of selected African countries