Assessing the spatial effects of economic freedom on forest-products, grazing-land, and cropland footprints: The case of Asia-Pacific countries

Jamal Mamkhezri; Goran M Muhamad; Mohsen Khezri

doi:10.1016/j.jenvman.2022.115274

Assessing the spatial effects of economic freedom on forest-products, grazing-land, and cropland footprints: The case of Asia-Pacific countries

J Environ Manage. 2022 Aug 15:316:115274. doi: 10.1016/j.jenvman.2022.115274. Epub 2022 May 20.

Authors

Jamal Mamkhezri¹, Goran M Muhamad², Mohsen Khezri³

Affiliations

¹ Department of Economics, Applied Statistics, and International Business, New Mexico State University, Las Cruces, NM, 88003, USA. Electronic address: jamalm@nmsu.edu.
² Department of Economics, School of Management and Economics, University of Kurdistan Hewlêr, 30 Meter Avenue, Erbil, Kurdistan Region, Iraq. Electronic address: goran.mustafa@ukh.edu.krd.
³ Department of Economics, School of Management and Economics, University of Kurdistan Hewlêr, 30 Meter Avenue, Erbil, Kurdistan Region, Iraq. Electronic address: mohsen.omarnaji@ukh.edu.krd.

PMID: 35658252
DOI: 10.1016/j.jenvman.2022.115274

Abstract

The literature has shown that economic freedom yields higher economic growth. However, the nexus between economic freedom and the environment in a world of spatial dependency is unclear. Using data from a panel of seventeen Asia-Pacific countries from 2000 to 2017, we investigate the direct and spillover effects of economic freedom (as measured by the annual indexes developed by the Heritage Foundation) and other variables on the ecological footprint of three land-cover types: cropland, forest products, and grazing land. Diagnostic tests confirm the existence of spatial-interaction effects in forest products and grazing land but reject it for cropland. Using a spatial Durbin panel model, we find that the intensity of energy use has a significant impact on the environmental footprint of all resource types. We also confirm the environmental Kuznets curve hypothesis for forest products and grazing land but not cropland. Unlike previous researchers, we find cropland footprints are unaffected by natural resource rents. We also find that the tax burden is the only economic freedom indicator with a positive and significant impact on all three environmental footprints. Our findings suggest that more investment freedom reduces environmental pressure on cropland and forest-products footprints but has a nonsignificant effect on the grazing-land footprint. Further, financial freedom reduces the forest-products footprint and increases the grazing-land footprint. Property rights, the tax burden, and business freedom increase environmental pressure while government spending lessens grazing land's ecological footprint. Our indirect and overall impact analyses suggest that all types of economic freedom reduce environmental strain in our panel. This research points to the importance of enacting environmental regulations in a way that guarantees ecological sustainability and economic development.

Keywords: Cropland footprint; Economic freedom; Forest-products footprint; Grazing-land footprint; Spatial panel analysis; Spillover effects.

MeSH terms

Asia
Carbon Dioxide* / analysis
Crops, Agricultural
Economic Development*
Forests
Freedom

Substances

Carbon Dioxide