Natural resources as a double-edged sword towards ecological quality: Can environmental regulations and green human capital rectify the adverse impacts?

Abstract

Natural resources are the backbone of any economy and the bedrock of ecological health. However, the relentless exploitation of these resources has given rise to ecological degradation. This threatens ecosystem stability, presenting the urgent need to balance natural resource utilization with ecological integrity. Environmental regulations and green human capital are pivotal in striking this balance and progressing towards the Sustainable Development Goals (SDGs). Therefore, this study explores how natural resources impact ecological quality in Ghana from 1990 to 2019 within the environmental Kuznets curve (EKC) framework, considering the role of environmental regulations and green human capital. The study employs the novel dynamic ARDL simulation method, presenting insights that diverge from patterns noted in previous studies. The study's findings reveal that natural resources intensify ecological quality in the short term but degrade ecological quality over the long term. Environmental regulation reduces ecological harm, while green human capital negatively impacts ecological quality. Environmental regulation and green human capital undesirably and beneficially impact how natural resources relate to ecological quality, with the undesirable effects occurring in the short term and the beneficial effects emerging over the long term. Further, a U-shaped relationship is observed between economic growth and ecological pollution in the short term, which transforms into an inverted U-shaped relationship in the long term, thus validating the EKC hypothesis in Ghana. The study concludes by recommending the implementation and enforcement of environmental regulations as a pathway toward achieving ecological quality and SDGs, particularly SDG 13, SDG 12, and SDG 7.