THE RELATIONSHIP BETWEEN EXTERNAL DEBT AND EMISSIONS AND ECOLOGICAL FOOTPRINT THROUGH ECONOMIC GROWTH: TURKEY

Abstract

The influence of external debt on the environment is a rising issue in the rapidly developing climate crisis. This study analyzes the relationship between carbon dioxide emissions per capita, gross domestic product per capita and ecological footprint per capita by applying an autoregressive distributed lag model for the Republic of Turkey. According to the results of this study there is an inverted U relationship between carbon dioxide emissions and external debt. There is no inverted U relationship between ecological footprint per capita and external debt while there is bidirectional causal relationship between external debt and economic growth. In addition, the results reveal that economic growth has a significant impact on ecological footprint per capita in the long run. There is causal relationship from external debt to emissions. This study recommends that further analysis be done for other countries that have high foreign debt to investigate the relationship between external debt and emissions. Similar analysis may be carried out for the external debt and ecological footprint per capita nexus for future studies.

Keywords:

• developing countries
• autoregressive distributed lag (ardl)
• sustainability
• environmental kuznets curve
• granger causality
• Turkey

jel classification:

• q01
• q56
• c01
• f65

Public Interest Statement

Developing countries such as Turkey has high external debt to finance their developments. Examining of external debt on the environment carries importance since significant amounts of external debt are spent on infrastructure. The key question here is: Is there a relationship between external debt and the environment in term of carbon dioxide emissions and ecological footprint for Turkey?. The findings show that the relationship holds for carbon dioxide emissions and the spending of external debt contributes positively to the environment. It is thus recommended that countries such as Turkey to continue projects to positively affect the environment and contribute to sustainability.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Author contributions

This article has been written in collaboration of two authors – Emrah Beşe and Haven Swint Friday. Emrah Beşe was responsible for research design and analysis. Haven Swint Friday worked on the literature and introduction parts. All the remaining parts of this study were processed in close collaboration of two authors.

Additional information

Funding

The authors have no funding to report.

Notes on contributors

Emrah Beşe

Emrah Beşe is a researcher. His interests include energy economics, environmental economics, sustainability and health economics. The current paper contributes to wider knowledge in the field of energy economics, environmental economics and sustainability. Specifically, it provides insights into the relationship between external debt and environment which is an important issue especially for developing countries.

H. Swint Friday

H. Swint Friday is a senior lecturer at Texas A&M University – RELLIS. His main teaching courses are Financial Management, Intermediate Corporate Finance and Insurance Principles.