article · World Development Sustainability
Trade liberalisation has expanded Ghana's international economic ties since 1957, but this integration has heavily influenced the use of natural resources and affected environmental quality. An evaluation using the autoregressive distributed lag error correction estimation technique reveals that trade positively influences sustainable development overall, despite generating adverse environmental effects. This dynamic demonstrates weak sustainability, as economic gains are prioritised over ecological preservation. Because enduring progress requires equilibrium across economic, social, and environmental considerations, shifting towards strong sustainability is vital. Targeted policy interventions are necessary to achieve this transition. In particular, establishing mechanisms for the judicious pricing of forests and natural resources can help optimise resource exploitation, mitigate negative externalities, and align economic expansion with environmental stewardship.
Economic growth driven by global trade often masks serious environmental damage. Recognizing that trade can foster economic progress while degrading ecosystems enables decision-makers to rethink development strategies. Setting accurate prices for natural resources helps countries protect their critical ecological assets without sacrificing the economic benefits necessary for national development.
The abstract outlines macroeconomic policy research rather than a commercial product or technical invention. The findings could inform environmental valuation frameworks and natural resource management policies developed by public sector agencies, economic planners, and resource regulators. As the study focuses on macroeconomic modelling and public policy interventions, it does not indicate a direct commercial application pathway.
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Since gaining independence in 1957, Ghana has significantly increased its economic ties with the global community through trade liberalization policies. However, this integration has profoundly affected the environment, particularly in utilizing natural resources, and has subsequently impacted sustainable development. This study examines the relationship between trade, environmental considerations, and sustainable development within the Ghanaian context. Using the autoregressive distributed lag (ARDL) error correction estimation technique, we found that trade positively impacts sustainable development in Ghana despite causing adverse environmental effects. This suggests that economic gains are prioritized over environmental preservation, indicating weak sustainability. However, sustainable development requires a balance between economic, social, and environmental factors, and a shift towards strong sustainability may be necessary for long-term sustainability. Therefore, pivotal policy interventions are warranted to navigate the path toward strong sustainability. Mechanisms that ensure the judicious pricing of Ghana's forest and natural resources are necessary to optimize resource exploitation while mitigating negative externalities. Ghana can promote inclusive and sustainable development by establishing a delicate balance between economic expansion and environmental stewardship.
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DOI: 10.1016/j.wds.2024.100134
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