Distribution-based effects of disaggregated GDP and environmental quality—a case of quantile on quantile estimates
2021
Hassan, Muhammad Shahid | Iqbal, Mubasher | Arshed, Noman
There is a strong association between environmental quality and economic activity. Empirical studies term this relationship as environmental Kuznets curve (EKC) using time series or panel data regression analysis, but their estimates are based on several assumptions. This study has explored the distribution oriented robust effect of disaggregated real GDP on environmental quality. These estimates are free of assumptions and provide the actual distribution of effects rather than a single value of the marginal effect. The data is collected for 189 countries between 1990 and 2018, and estimates are generated using panel quantile regression and quantile on quantile regression. The estimation results point towards the U-shaped industry EKC, inverted U-shaped service EKC, and linear agriculture EKC. The robust, practical, and realistic estimates of real economic activity and environment have paved way towards an in-depth analysis to sustain a better environmental quality.
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