Investigating the Impact of Corruption and Sanctions on Carbon Dioxide Emissions and Tree Cover Loss in Selected Asian Countries: Application of PCSE Estimator
Subject Areas : Environmental EconomicsSomayeh Azami 1 * , Zahra Moradi 2 , shahram fatahi 3
1 - Associate Professor, Department of Economics, Razi University, Kermanshah, Iran. *(Corresponding Author)
2 - - M.A. student, Department of Economics, Razi University, Kermanshah, Iran.
3 - Professor, Department of Economics, Razi University, Kermanshah, Iran.
Keywords: Sanctions, Corruption, CO2 emission, Tree Cover Loss, PCSE estimation,
Abstract :
Background and Objectives: Today, the environmental crisis and climate change have become global concerns. This research aims to examine the impact of corruption and sanctions on the environmental quality of selected Asian countries with high levels of corruption that have experienced sanctions during different periods. These countries include China, Iran, Indonesia, Pakistan, Iraq, Myanmar, Syria, Lebanon, and Yemen.
Material and Methodology: The research methodology employs panel econometrics, covering the period from 1991 to 2019. The environmental indicators examined include carbon dioxide emissions and tree cover loss. Nine different definitions of the sanctions variable have been used in this study. The results have been analyzed using the PCSE method.
Findings: The cointegration test results indicate a long-term relationship between the model variables. The PCSE estimation results show that corruption significantly increases carbon dioxide emissions and reduces tree cover. On the other hand, sanctions significantly reduce tree cover but do not have a significant effect on increasing carbon dioxide emissions.
Discussion and Conclusion: The result that sanctions do not significantly increase carbon dioxide emissions may be linked to the anti-growth mechanism of sanctions. Overall, combating corruption and implementing precise policies regarding sanctions can help improve the environmental situation in these countries.
1. Access to a healthy environment, declared a human right by UN rights council | | UN News [Internet]. United Nation. 2021 [cited 2021 Oct 9]. Available from: https://news.un.org/en/story/2021/10/1102582
2. Madani K. How International Economic Sanctions Harm the Environment. Earth’s Futur. 2020;8(12).
3. Ezzati, Morteza, Heydari, Hasan, Moridi P. The Effect of Economic Sanctions on Production and Employment of Industry in Iran. Q J Macro Strateg Policies. 2020;8(1):38–65. (In Persian)
4. Khalid U, Ali MT, Okafor L, Sanusi O. Do sanctions affect the environment? The role of trade integration. Research in Globalization. 2023. p. 100191.
5. Germani F, März JW, Clarinval C et al. Economic sanctions, healthcare and the right to health. BMJ Glob Heal. 2022;7(7).
6. Gu, Tianjie, Zhao J. Beyond sanctions and anti-sanctions: examining the impact on sustainable competition and China’s responses. Int J Leg Discourse. 2023;8(1):95–119.
7. Jermano J. Sanctions and Corruption: Assessing Risk to Improve Design. Just Security. 2021. p. 5.
8. HMT Tran, MH Nguyen H Le. THE IMPACTS OF GLOBAL ECONOMIC SANCTIONS ON CORRUPTION: A GLOBAL ANALYSIS. Glob Econ J. 2023;22(04):28.
9. Kamali T, Mashayekh M, Jandaghi G. The Impact of Economic Sanctions on Corruption in Target Countries: A Cross Country Study. World Sci News [Internet]. 2016;45(2):276–91. Available from: www.worldscientificnews.com
10. Fu Q, Chen YE, Jang CL, Chang CP. The impact of international sanctions on environmental performance. Sci Total Environ. 2020;745.
11. Seligson MA. The impact of corruption on regime legitimacy: A comparative study of four Latin American countries. J Polit. 2002;64(2):408–33.
12. Huihua N, Li J. Collusion and Economic Growth: A New Perspective on the China Model. Econ Polit Stud. 2013;1(2):18–39.
13. Fredriksson PG, Svensson J. Political instability, corruption and policy formation: The case of environmental policy. J Public Econ. 2003;87(7–8):1383–405.
14. Mirzazadeh I. The Nexus between Corruption and the Rule of Law. SSRN Electronic Journal. 2022. p. 12.
15. Masters J. What are Economic Sanctions? Council on Foreign Relations. The Council on Foreign Relations (CFR); 2019. p. 6–15.
16. Iranmanesh S, Salehi N, Jalaee S abdolmajid. Using the fuzzy logic approach to extract the index of economic sanctions in the Islamic Republic of Iran. MethodsX. 2021;8.
17. Aloosh M, Salavati A, Aloosh A. Economic sanctions threaten population health: the case of Iran. Public Health [Internet]. 2019;169:10–3. Available from: https://doi.org/10.1016/j.puhe.2019.01.006
18. Rustler A. Are sanctions stopping us from achieving global climate goals? J Int Aff [Internet]. 2019;2018. Available from: https://jia.sipa.columbia.edu/online-articles/are-sanctions-stopping-us-achieving-global-climate-goals
19. Fotourehchi Z. Are UN and US economic sanctions a cause or cure for the environment: empirical evidence from Iran. Environ Dev Sustain [Internet]. 2020;22(6):5483–501. Available from: https://doi.org/10.1007/s10668-019-00434-0
20. Madani K. Have International Sanctions Impacted Iran’s Environment? World. 2021;2(2):231–52.
21. Matin, Shahab, Ghaemi, Mahdi, Homayoonifar M. Effects of trade openness on energy intensity and environmental performance indicators, with emphasis on the role of trade sanctions on Iran. In: International E-Conference on Economy under sanctions. (In Persian) Mazandaran, Iran; 2013.
22. Mashhadi, Ali, Rashidi M. The Effects of Imposed Sanctions against Iran on Environment, Energy & Technology Transfer in International Law. Public law Res [Internet]. 2015;15(46):103–23. Available from: http://journals.atu.ac.ir/article_1385_2b7e84583891423ef3042fb3737844aa. (In Persian)
23. Fahimifard SM. Studying the Effect of Economic Sanctions on Iran’s Environmental Indexes (SVAR Approach). J Econom Model [Internet]. 2020;5(3):93–119. Available from: https://jem.semnan.ac.ir/article_4747_4876a0456aed74f87f1713d8811f2935. (In Persian)
24. Management IPR and E. Helping countries combat corruption : progress at the World Bank since 1997. World Development. Washington, D.C: The World Bank, Operational Core Services (OCS), Poverty Reduction and Economic Management (PREM) Network,; 2000.
25. Lisciandra M, Migliardo C. An Empirical Study of the Impact of Corruption on Environmental Performance: Evidence from Panel Data. Environ Resour Econ. 2017;68(2):297–318.
26. Damania R, Fredriksson PG, List JA. Trade liberalization, corruption, and environmental policy formation: Theory and evidence. J Environ Econ Manage. 2003;46(3):490–512.
27. Pellegrini L, Gerlagh R. Corruption, Democracy, and Environmental Policy. Environ Dev. 2006;15(3):332–54.
28. Cole MA. Corruption, income and the environment: An empirical analysis. Ecol Econ. 2007;62(3–4):637–47.
29. Wang Z, Danish, Zhang B, Wang B. The moderating role of corruption between economic growth and CO2 emissions: Evidence from BRICS economies. Energy [Internet]. 2018;148:506–13. Available from: https://doi.org/10.1016/j.energy.2018.01.167
30. Chen H, Hao Y, Li J, Song X. The impact of environmental regulation, shadow economy, and corruption on environmental quality: Theory and empirical evidence from China [Internet]. Vol. 195, Journal of Cleaner Production. Elsevier Ltd; 2018. 200–214 p. Available from: https://doi.org/10.1016/j.jclepro.2018.05.206
31. Akhbari R, Nejati M. The effect of corruption on carbon emissions in developed and developing countries: empirical investigation of a claim. Heliyon [Internet]. 2019;5(9):e02516. Available from: https://doi.org/10.1016/j.heliyon.2019.e02516. (In Persian)
32. Arminen H, Menegaki AN. Corruption, climate and the energy-environment-growth nexus. Energy Econ [Internet]. 2019;80:621–34. Available from: https://doi.org/10.1016/j.eneco.2019.02.009
33. Ganda F. The influence of corruption on environmental sustainability in the developing economies of Southern Africa. Heliyon [Internet]. 2020;6(7):e04387. Available from: https://doi.org/10.1016/j.heliyon.2020.e04387
34. Wang S, Zhao D, Chen H. Government corruption, resource misallocation, and ecological efficiency. Energy Econ [Internet]. 2020;85:104573. Available from: https://doi.org/10.1016/j.eneco.2019.104573
35. Zhou M, Wang B, Chen Z. Has the anti-corruption campaign decreased air pollution in China? Energy Econ [Internet]. 2020;91:104878. Available from: https://doi.org/10.1016/j.eneco.2020.104878
36. Liu Y, Dong F. Haze pollution and corruption: A perspective of mediating and moderating roles. J Clean Prod [Internet]. 2021;279:123550. Available from: https://doi.org/10.1016/j.jclepro.2020.123550
37. Alizade S, Bayat M. The Effect of Good Governance on the Environment in Middle-Income Countries [Internet]. Vol. 18, Journal of Environmental Science and Technology (JEST). 2016. p. 501–13. Available from: https://jest.srbiau.ac.ir/article_9870_d12f05ce8d92b1e38d3e1386b35ac6ab. (In Persian)
38. ArabmazarYAZDI A, Ghsemi A, Rashidi kia M. Effects of Corruption and Political Instability on Environmental Performance; a Case Study of Selected Countries in the Middle East. Environ Res. 2017;8(15):77–86. (In Persian)
39. Azami S, Rezaei M. The Impact of Corruption on Carbon Dioxide Emissions in Developed and Developing Countries: an Approach to Panel Quantile Regression. J Econ Stud Policies [Internet]. 2017;4(7):133–50. Available from: https://economic.mofidu.ac.ir/article_32483_238333b223c53580e7ffe847632ac021. (In Persian) 40.
40. Mohammadi T, Momeni F, Sazeedeh M. The Effect of Corruption on Environmental Quality. J Econ Stud Policies [Internet]. 2017;4(7):107–32. Available from: https://economic.mofidu.ac.ir/article_32482_89d9a6ad3a2296e8ab2aa196610d12f5.
(In Persian)
41. Parks RW. Efficient Estimation of a System of Regression and Contemporaneously Correlated [Internet]. Vol. 1459, Journal of the American Statistical Association. 1967. p. 500–9. Available from: https://www-jstor-org.galanga.hvl.no/stable/pdf/2283977.pdf?refreqid=excelsior%3A7db4fcfa836fe2b50281a8aee71fb869
42. Kmenta J. Elements of Econometrics. 2nd ed. New York, NY: Macmillan; 1986. 808 p.
43. Beck, N, Katz J. What To Do (and Not To Do) with Times-Series{Cross-Section Data. Am Polit Sci Rev. 1995;89(3):643–7.
44. Felbermayr G, Kirilakha A, Syropoulos C, Yalcin E, Yotov Y V. The global sanctions data base. Eur Econ Rev [Internet]. 2020;129:103561. Available from: https://doi.org/10.1016/j.euroecorev.2020.103561
45. Tawiah V, Zakari A, Alvarado R. Effect of corruption on green growth. Environ Dev Sustain. 2023;
46. Leitão NC. The Effects of Corruption , Renewable Energy , Trade and CO 2 Emissions. Economies. 2021;9(2):19.