The impact of public-private investment in energy on environmental degradation: evidence from major investment countries.

Abstract

The objective of the present study is to explore the impact of public-private investment in energy, foreign direct investment, urbanization, and renewable and non-renewable energy consumption on environmental degradation in major investment countries during the period 1998Q4-2018Q4. In doing so, the cross-sectional dependence test and CIPS panel unit test were employed to identify the cross-sectionally dependency and the integrational properties/stationarity among the variables. Furthermore, we opted for Westerlund (2007) panel cointegration test to check the long-run association among the variables. To achieve the short-run and long-run elasticities, we have recommended cross-sectional-autoregressive distributive lag (CS-ARDL). The study outcomes revealed that public-private partnership in energy is negatively and significantly impacting CO2 emissions in both the short run and the long run. Furthermore, foreign direct investment and urbanization are negatively related to CO2 emissions, while renewable energy is positively affected it. However, the coefficients are insignificant. Moreover, non-renewable energy has a positive and substantial influence on CO2 emissions. Lastly, study outcomes offer several policy insights to develop investment in public and private partnerships in the energy sector to reduce CO2 emissions in major investment countries.