Environmental Kuznets Curve (EKC) Hypothesis and Co2 Emissions: An Empirical Study of MENA Developing Countries

Abstract

This study examines the impact of per capita income, its square, forest area, FDI inflows, population density, urbanization, and trade openness on CO2 emissions in MENA developing countries. Using 35 years of data (1981–2015) from the WDI, stationary was tested with the ADF test, and the ARDL bounds testing approach was applied. Results show that all variables significantly reduce CO2 emissions in both the short and long run. Unit root tests indicate that CO2 emissions and per capita GDP are occasionally co-integrated, supporting the Environmental Kuznets Curve (EKC) hypothesis. The findings highlight that higher income and FDI contribute to emission reduction, while coordinated environmental and economic policies are essential for sustainable development in developing MENA countries. Similarly, the findings show that developing countries need to bring into line a well-coordinated environmental and economic policy mix that would ensure greater output. Similarly, at the same time look after their environment from deprivation and pollution.

Keywords: Environmental Kuznets Curve (EKC) Hypothesis, CO2 Emissions, Population Density, Urbanization, Trade Openness