Nonlinear and nonparametric causal relationship between financial inclusion and sustainable environment in South Asia

This study analyzes the causal connection between financial inclusion and carbon emission in selected South Asian countries through a quantile technique–based linear Granger and non-parametric causality test. The analysis of the study covers quarterly data from 1980 Q1 to 2019 Q4. However, the linea...

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Published inEnvironmental science and pollution research international Vol. 30; no. 1; pp. 2218 - 2232
Main Authors Jingpeng, Li, Ullah, Asad, Raza, Syed Ali, Ahmed, Maiyra
Format Journal Article
LanguageEnglish
Published Berlin/Heidelberg Springer Berlin Heidelberg 2023
Subjects
Aquatic Pollution
Asia, Southern
Atmospheric Protection/Air Quality Control/Air Pollution
Carbon
Carbon Dioxide - analysis
Earth and Environmental Science
Economic Development
Ecotoxicology
Environment
Environmental Chemistry
Environmental Health
Humans
Renewable Energy
Research Article
Waste Water Technology
Water Management
Water Pollution Control
Asia, Southern
Carbon emission
Causality in quantile
Sustainable environment
Financial inclusion
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Summary:This study analyzes the causal connection between financial inclusion and carbon emission in selected South Asian countries through a quantile technique–based linear Granger and non-parametric causality test. The analysis of the study covers quarterly data from 1980 Q1 to 2019 Q4. However, the linear Granger causality assessment outcome does not indicate any causal relationship between financial inclusion and carbon emission. In contrast, results from non-parametric assessment reveal a non-linear connection between the variables. The non-parametric test results of the South Asian countries exhibit that financial inclusion leads to carbon emission, which instigates the deterioration of the environment, except for Bhutan. Subsequently, creating awareness by promoting renewable energy resources is essential while investing in fuel-efficient technology to reduce the dependence on fossil fuels. The results of this study provide significant information to the governments and policymakers in emerging countries to improve financial literacy among people to reduce the risk of global warming by encouraging investment in energy-efficient resources.
ISSN:0944-1344
1614-7499
DOI:10.1007/s11356-022-22301-8