The enigma of environmental sustainability and carbonization: Assessing the connection between coal and oil rents, natural resources, and environmental quality

Abstract

The damage caused by various kinds of pollution to our natural resources, health, and way of life is increasing. The fundamental cause of ecological degradation is the release of greenhouse gases that includes carbon dioxide produced by humans, which may still be harmful if the emissions come from unsustainable sources. The primary goal of this study was to examine the impact of coal and oil rents, urban agglomeration, and economic growth on environmental quality in Pakistan using yearly data from 1971 to 2019. The interaction between the key variables was identified using an asymmetric (Non-linear Autoregressive Distributed Lag) model. Natural resources have a considerable influence on environmental quality according to long-run and short-run results. Economic progress is also significantly impacted, while through the analysis urban agglomeration has a detrimental influence on environmental quality through positive and negative shocks. Furthermore, the findings of oil rents had a negative and positive effect on carbonization, whereas coal rents had a negative impact on environmental inclusion. Carbon dioxide emission is presently a worldwide rising concern; thus, Pakistan should also play a substantial role regarding the reduction of CO2 emission and adopt the productive policies in direction to support the environmental sustainability.