The Impacts of Agricultural Trade on Economic Growth and Environmental Pollution: Evidence from Bangladesh Using ARDL in the Presence of Structural Breaks

Amogh Ghimire,Peifen Zhuang,Feiting Lin

doi:10.3390/su13158336

Abstract

Agricultural trade significantly promotes the economic boom in developing countries. Extensive traditional agricultural production methods have increased the pressure on the agricultural environment by expanding agricultural trade, which has attracted the attention of many scholars. This study aims to empirically examine the impacts of agricultural trade on economic growth and agricultural environmental pollution in Bangladesh from 1972 to 2019, using an Auto Regressive Distributed Lag (ARDL) model with a structural break to examine the long-run and short-run determinants of agricultural environmental pollution in Bangladesh. The ARDL bounds analysis methodology showed that it does not support the hypothesis that agricultural trade led to environmental pollution in the long-run. The results suggest a relationship between economic growth, energy, and FDI towards agricultural environmental pollution, indicating a positive long-run relationship. Furthermore, in the short run, agricultural trade indicates positive drivers towards agricultural environmental pollution. Therefore, it is recommended that the enhancement of trade liberalization policies should ensure cleaner technologies and products that could help reduce environmental pollution.

Highlights

Bangladesh is primarily an agricultural nation and the agriculture sector plays a vital role in driving the economy, accounting for 50 percent of its employment, and with its gross domestic product (GDP) accounting for 20% of the country’s total GDP [1]
What is the relationship between agricultural trade and environmental pollution in Bangladesh? Does economic growth necessarily lead to environmental degradation?
The coefficient (−0.07) of trade openness (TRO) shows that a 1% increase in economic growth leads to an 0.07% diminish in agricultural environmental pollution (AEP) in the long run

Summary

Introduction

Bangladesh is primarily an agricultural nation and the agriculture sector plays a vital role in driving the economy, accounting for 50 percent of its employment, and with its gross domestic product (GDP) accounting for 20% of the country’s total GDP [1]. Agricultural inputs such as chemical fertilizers, pesticides, diesel oil, and electricity for irrigation have increased, leading to the increase of carbon emissions in the process of agricultural production, and other corresponding environmental pollution problems have been gradually highlighted. The solution is for people to link the rapid growth of trade with the situation of environmental pollution. What is the relationship between agricultural trade and environmental pollution in Bangladesh? What is the relationship between agricultural trade and environmental pollution in Bangladesh? Does economic growth necessarily lead to environmental degradation?

Objectives

Methods

Findings

Discussion

Conclusion