article · Management Science Letters
Economic growth remains a central goal for national economies, yet expanding output frequently brings significant environmental consequences. An examination of historical data from Saudi Arabia spanning 1968 to 2014 reveals how economic expansion and energy usage influence carbon dioxide pollution over time. Statistical cointegration testing demonstrates that both rising economic growth and elevated energy consumption directly drive increases in carbon emissions across both the short and long run. Consequently, ongoing economic development in the Kingdom incurs substantial social costs tied directly to environmental degradation and pollution. Addressing these linked challenges requires structural adjustments in national energy usage. Adopting alternative renewable energy sources offers a viable pathway to sustain economic progress while mitigating the harmful ecological and social impacts associated with traditional fuel consumption.
Balancing national economic progress with environmental preservation is an urgent global challenge. Establishing the statistical link between growth, fuel consumption, and carbon emissions shows that standard development strategies impose heavy social costs through pollution. These findings highlight the necessity of integrating renewable energy solutions into national planning to ensure sustainable long-term economic development.
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Economic growth is very basic need of any economy but its environmental effects should not be ignored. We investigate the environmental effects of economic growth and energy consumption of Saudi Arabia. The study uses data of a period 1968-2014 and cointegration test and corroborates a long-and short-run relationships. The results indicate that economic growth and energy consumption contributes in CO2 emissions in both long-and short-run. It means that increasing economic growth of the Kingdom has social cost on the economy in terms of pollution emissions. Based on findings, we recommend to use the alternative renewable sources of energy consumption to avoid the pollution effects of growth in Saudi Arabia.
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DOI: 10.5267/j.msl.2019.11.013
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