The impact of natural resources, energy consumption, and population growth on environmental quality: Fresh evidence from the United States of America

https://doi.org/10.1016/j.scitotenv.2020.142222Get rights and content

Highlights

  • Impact of natural resources, energy consumption, and population growth on environment quality checked.

  • Natural resources and renewable energy improves environmental quality.

  • Non-renewable energy and population growth degrade environmental quality.

  • Natural resources, CO2 emissions, and ecological footprint bidirectionally liken.

  • Population growth, ecological footprint, and CO2 emissions unidirectionally liken.

Abstract

We examine the impact of the amount of natural resources, energy consumption, and population growth on the ecological footprint and CO2 emissions using data of the United States (USA) from 1971 to 2016. In the course of this study, we developed a comprehensive empirical analysis and applied structural break Zivot-Andrews and Breakpoint ADF unit-roots tests for stationary analysis. The co-integration analysis indicates long-run relationships among the variables. Subsequent findings of the generalized method of moments (GMM), generalized linear model (GLM), and robust least-squares reveal an inverse relationship of natural resources and renewable energy consumption with the ecological footprint and CO2 emissions, while non-renewable energy consumption, population growth, and biocapacity have a positive relationship with the ecological footprint and CO2 emissions. Overall, our findings suggest that natural resources and renewable energy consumption improve environmental quality in the long run, while population growth and non-renewable energy consumption contribute to its deterioration. In addition, the result of pairwise Granger causality reveals that bidirectional causality runs between natural resources and CO2 emissions and between natural resources and the ecological footprint, while unidirectional causality runs from population growth to energy consumption, the ecological footprint, and CO2 emissions. Policymakers in the USA are encouraged to establish policies that control the excessive use of natural resources, promote sustainable lifestyles, develop energy-efficient carbon pricing, and fix the ecological budget to secure a sustainable future for the country.

Introduction

The greatest threat to the world's sustainable development is the deteriorating environmental quality that results from increasing greenhouse gas (GHG) emissions. Studies like those of Aye and Edoja (2017), Khan et al. (2020b), Omri et al. (2015), Shafik (1994), and Thomakos and Alexopoulos (2016) used CO2 emissions to assess environmental hazardous because CO2 emissions make up a substantial part of GHGs (Zafar et al., 2019). However, CO2 emissions as a measure of environmental degradation are not always a suitable indicator. For instance, Danish, Hassan, Baloch, Mahmood, and Zhang (2019b) and Ulucak and Apergis (2018) contended that CO2 emissions may not be a definite indicator of environmental deterioration in such areas as mining, oil, soil, and forests. Therefore, an aggregated indicator is needed to address sustainable development and ecological decline (Solarin and Bello, 2018). The ecological footprint (EFP) is used extensively to estimate environmental quality and sustainability (Chen et al., 2010; Solarin and Bello, 2018) and is a useful measure for managing and determining the natural resources (NRs) used in a society (GFN, 2018). NRs have been given considerable global attention in the literature as having broad economic implications (Auty, 2000; Berkeley, 1997; Sachs and Warner, 1995).

The EFP is one of the mechanisms that measure the environmental pressure created by humans' extensive consumption of NRs (Catton and Dunlap, 1980; Ehrilich and Holdren, 1986; Vitousek et al., 2012). Its origin lies in the classical sustainability principle that states that the consumption of renewable resources should not surpass their capacity to reproduce (Daly, 1990). Rees (1992) initially used the expression “appropriated carrying capacity” in determining environmental sustainability until Rees and Wackernagel (1996) retitled that concept EFP. The EFP measures and designates the anthropogenic stress on the environment by the human population and the regeneration capacity of the biosphere. EFP is an aggregate parameter, so we use it in this study, along with CO2 emissions, as an indicator of environmental quality.

The economy of the United States of America (USA) has seen tremendous economic growth in the last two decades. The country's gross domestic product (GDP) is ranked first in the world, while GDP per capita is ranked eighth (Zafar et al., 2019). However, the country's economy is facing challenges like over-consumption of NRs, increasing population, and growing CO2 emissions (Union of Concerned Scientists, 2009). Hence, CO2 emissions and population growth (POP) are directly linked with climate change and are pressing issues in the USA. The country's CO2 emissions were 5.01 million kilotons (kt) in 2016, the second-highest in the world and the highest among countries in the industrialized world, as it consumes about 25% of the total energy produced in the world and has the highest oil consumption in the world. The USA's housing sector contributes 12% of the world's home-related GHG emissions. The USA is also the seventh largest economy enriched with NRs1 WorldAtlas (2018), yet it imports twenty out of ninety inorganic commodities (Markham, 2008; WorldAtlas, 2018; Zafar et al., 2019). The links between the USA's CO2 emissions, energy consumption, and NRs offer a unique opportunity to gain insights into what affects the country's environmental quality.

The first question that this study addresses is how many of the USA's NRs affect its EFP and CO2 emissions. According to the Global Footprint Network (GFN), NRs like the grazing land footprint, the forest footprint, the fishing grounds footprint, the cropland footprint, the carbon footprint, the growing land footprint, and pasture counterbalance CO2 emissions that come from the consumption of fossil fuels and contribute to producing energy. At the same time, some NRs, such as coal and petroleum, contribute to environmental degradation and reduction of biodiversity, which ultimately impact people's health, contentment, and prosperity (Ahmadov and van der Borg, 2019; WorldWildlifeFund, 2019). Nature and Its resources are closely associated and an integral part of the socioeconomic system, as the prosperity of human societies is heavily dependent on these resources. In the early phases of economic development, people consumed NRs (energy) more rapidly than they do now, and they scorned environmental considerations. However, as the quality of life improves in the later phase of economic development, economies consider the effects of environmental degradation and start demanding renewable, environment-friendly, and energy-efficient resources (Zafar et al., 2019).

In all likelihood, the most challenging environmental problem facing humanity in this century will be global climate change. There is sound evidence that burning fossil fuels like coal, oil, and natural gas is changing Earth's climate by increasing the amount of CO2 in the atmosphere. Most of the energy in the USA comes from non-renewable resources. In 2019, the USA generated about 4.12 trillion kilowatt hours (kWh) of energy, of which 2580 kWh (62.7%) came from coal, and 1582 kWh (38.4%) came from natural gas. Only 720 kWh (17.5%) of the total electricity was generated from renewable sources (EIA, 2019a). CO2 emissions related to the USA's energy sector increased by 2.7%, from 5130 million metric tons (MMT) in 2017 to 5269 MMT in 2018. At the same time, the country's total carbon intensity (CO2 emissions/GDP) declined to 0.1% in 2018 compared to 2.9% in 2017. On the consumption side, energy consumption in the USA increased from 300 million British thermal units (BTUs) per person in 2017 to 309 million BTUs per person in 2018, a significant amount given that the average per person energy consumption in the world in 2018 was about 77 million BTUs (EIA, 2019b, EIA, 2019a).

Another important question this study addresses concerns the increasing evidence that a growing population, which is linked to energy usage and GHG emissions, is a crucial factor in global climate change. POP in the USA is a significant multiplier, especially as it relates to resource consumption (Markham, 2008). With less than 5% of the world's population, the USA consumes about 17% of the world's energy production, which accounts for about 15% of the world's GDP. The USA's population is expected to increase from 328 million people in 2018 to about 404 million people in 2060 (Sustainability-Indicators, 2019). The question arises, then, how much land would be required to sustain such a massive growth in the population. Such prodigious POP will create immense pressure on environmental sustainability and resources. The ecological risk of overpopulation has been acknowledged since Malthus' study in 1978. The classic literature, such as Keeble (1987), Meadows et al. (1972), and Visser and Brundtland (1987) has also acknowledged such environmental threats.

A thorough empirical study of the case of the USA is important because the USA is the second-largest emitter of CO2 emissions (BP-Statistics, 2019), the home of the most foreign direct investment (FDI) (World-Bank, 2019), and the seventh largest holder of NRs on the globe (WorldAtlas, 2018). The USA is also the wealthiest country in the world, having about a 25% share of the world's GDP (World Bank, 2017). Even though it has less than 5% of the world's population, it consumes 17% of the world's energy resources (Sustainability-Indicators, 2019). The literature has largely overlooked the role of POP and energy consumption in the USA's EFP and CO2 emissions. The purpose of this study is to determine the impact of NRs, energy consumption, and POP on the USA's EFP and CO2 emissions in various production functions, using biocapacity (BC) as a moderator variable, over the period 1971 to 2016. Multiple interactions of the EFP and CO2 emissions with energy consumption, POP, and NRs have not been studied together in separate equation for the USA.

This paper contributes to the literature by providing an empirical analysis of a developed nation and determining the links among NRs, energy consumption, POP, EFP, and CO2 emissions from the perspective of environment quality. Undeveloped countries adopt the strategies and policies of developed countries like the USA, so the USA's economy deserves a detailed empirical investigation. Our brief study period contains the 1973–75 oil crisis and the recessions of 1980, 1981–82, the early 1990s (related to the oil price shock), and the early 2000s, and the great recession of 2007–2009. We applied advance stationary analysis, including the Zivot-Andrews and Breakpoint ADF unit-root tests, and used the generalized method of moments (GMM), the generalized linear model (GLM), and the robust least-squares techniques to approach the long-run relationships among the variables.

The paper is structured as follows: Section 2 provides a brief literature review. Section 3 discusses modeling and data, whereas Section 4 summarizes the methodological framework. The empirical results and discussions are in Section 5, while the last section contains concluding remarks along with useful policy recommendations.

Section snippets

Literature review

We review the literature that covers the links among NRs, energy consumption, POP, CO2 emissions, and EFP for particular countries, particular regions, or a specific group of countries, employing specific econometric methodologies, variables, and periods. We discuss three primary relationships: those between energy consumption and environmental quality, between natural resources and environmental quality, and between POP and environmental quality.

Theoretical background

The literature on energy and the environment has used various proxies and methodologies to measure environmental quality. For example, Danish and Baloch (2018), and Youssef et al. (2014) employed Sulfur Dioxide (SO2), while Cole et al. (1997), and Yahaya et al. (2016) applied Nitrous Oxide (NO2). In contrast, Arshad Ansari et al. (2020) measured environmental quality using the ecological and material footprint. She studies like those of Ahmad et al. (2016), Chen et al. (2020), Li et al. (2020),

Unit-root tests without structural breakpoint

A unit root refers to the stochastic trend in the time series, which may create problems in statistical inferences that link with time series models. We applied Dicky-Fuller's (1997) augmented Dickey-Fuller test, Phillips and Perron's (1988) Phillips-Peron test, Vougas' (2007) DF-GLS De-trended Residuals, and Kwiatkowski et al.'s (1992) KPSS unit-root tests to tests the presence of unit-roots among the time series. The standard Dicky-Fuller's (1997) ADF was carried out as:yt=c+ayt1+j=1kdjyt

Empirical results and discussion

Table 2 shows the outcome of pairwise correlation and empirical distribution analyses for EFP, CO2 emissions, NRs, RE, NRE, POP, and BC in the USA. The empirical distribution analysis confirms that all variables are normally distributed and statistically significant (at various levels). The pairwise correlation analysis reveals negative associations between RE and EFP, between RE and NRs, and between RE and CO2 emissions and a positive relationship between NRs and EFP. All of these descriptive

Implications for theory and practice

The long-run estimates, causality relationships, and detailed empirical investigation have policy implications for the USA.

  • NRs have negative relationships with EFP and CO2 emissions in the USA, so the increasing structure of NRs in the USA will improve the country's current environmental conditions. The government of the USA should limit the unnecessary consumption of NRs and should develop the institutions to address the issues that pertain to this important component of environmental quality.

Declaration of competing interest

All authors approve no known competing conflict of interest exists in the submission of this manuscript for publication in the Science of the Total Environment

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