Disaggregating the Ecological Footprints of Trade in Pakistan

##plugins.themes.academic_pro.article.sidebar##

Published Dec 31, 2023
https://doi.org/10.61506/02.00159
Download
PDF
Statistic
Vol. 9 No. 4 (2023)

##plugins.themes.academic_pro.article.main##

Samina Khalil
Research Professor and Former Director, Applied Economics Research Centre (AERC), University of Karachi

Abstract

This study employs an ARDL model to examine the long- and short-run relationships between economic growth, trade in services, energy, and Pakistan’s import ecological footprints, using time-series data from 1990 to 2022. The model demonstrates strong illustrative power, with an R-squared of 0.9865 and a low RMSE of 0.0071, emphasizing the accuracy of modeling Import Footprints. In the long run, the bio-capacity of imports emerges as a significant positive factor (coefficient = 1.2846, p < 0.001), revealing that imports with high bio-capacity demand, such as agricultural or forest products, are major contributors to the ecological footprint. Although GDP has a tad significant effect (p = 0.059), indicating potential efficiency gains in import production per GDP unit, energy consumption, inflation, and population effects remain statistically insignificant, suggesting that their environmental impacts may be channeled primarily through domestic production. In the short run, import bio-capacity continues to reveal a significant effect (coefficient = 1.0623, p = 0.005), highlighting that fluctuations in bio-capacity-intensive imports can immediately alter the ecological footprint. The results indicate that while trade in services and energy consumption show limited direct environmental impacts, managing imports with substantial bio-capacity needs is critical for sustainable trade policy. This analysis provides intuitions into the ecological implications of Pakistan’s import composition and highlights the importance of aligning trade and environmental policy to manage long-term ecological footprints effectively.

##plugins.themes.academic_pro.article.details##

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

How to Cite
[1]
Khalil, S. 2023. Disaggregating the Ecological Footprints of Trade in Pakistan. Journal of Policy Research. 9, 4 (Dec. 2023), 355–363. DOI:https://doi.org/10.61506/02.00159.
Crossref
Scopus
Google Scholar
Europe PMC

References

  1. Alam, M., Khan, M. A., & Mehmood, M. (2022). Environmental impact assessment of trade liberalization: The case of Pakistan’s economy. Journal of Environmental Economics and Policy, 14(2), 157–175. https://doi.org/10.1080/21606544.2022.112035
  2. Choi, Y., Lee, J., & Park, K. (2020). Trade openness and carbon emissions: Evidence from South Korea. Environmental Economics and Policy Studies, 22(4), 797-817.
  3. Dietz, T., & Rosa, E. A. (1994). Rethinking the environmental impacts of population, affluence, and technology. Human Ecology Review, 1(2), 277-300.
  4. Dietz, T., Rosa, E. A., & York, R. (2007). Driving the human ecological footprint. Frontiers in Ecology and the Environment, 5(1), 13-18.
  5. Ewing, B., Reed, A., Galli, A., Kitzes, J., & Wackernagel, M. (2010). The calculation methodology for the national footprint accounts, 2010 edition. Global Footprint Network.
  6. Farooq, M., & Chani, M. (2018). Trade liberalization and environmental degradation: Evidence from Pakistan using VECM. Journal of Environmental Economics and Management, 9(2), 112-123.
  7. Giljum, S., Hubacek, K., & Sun, L. (2007). Beyond the simple material balance: Accounting for resource extraction and use in China. Environment, Development and Sustainability, 9(2), 199-219.
  8. Hassan, S., Bashir, M. K., & Shahbaz, M. (2020). Water footprint and sustainability of food consumption: An environmental analysis of Pakistan’s agri-based trade. Agricultural Economics Research, 9(4), 22–37. https://doi.org/10.1016/j.agrer.2020.08.003
  9. Khan, M. I., & ATHAR, F. (2017) Do Income Growth and Trade Expansion Reallocate the Ecological Footprints? A Case Study of Pakistan.
  10. Kumar, A., & Agarwal, R. (2019). Energy consumption and environmental degradation in India: Evidence from panel data analysis. Environmental Economics and Policy Studies, 21(2), 285-305.
  11. Lenzen, M., Dey, C. J., & Foran, B. (2004). Energy requirements of Sydney households. Ecological Economics, 49(3), 375-399.
  12. Li, H., & Zhang, X. (2022). Sustainable development and trade: The role of biocapacity in ecological footprints. Environmental Economics and Policy Studies, 24(1), 95-108.
  13. Rees, W. E. (1992). Ecological footprints and appropriated carrying capacity: What urban economics leaves out. Environment and Urbanization, 4(2), 121-130.
  14. Rees, W. E., & Wackernagel, M. (1996). Our ecological footprint: Reducing human impact on the earth. New Society Publishers.
  15. Silva, J. S., Souza, J. C., & Costa, S. P. (2021). The impact of industrialization on ecological footprints in Brazil: A time series analysis. Global Environmental Change, 69, 102292.
  16. Stiglitz, J. E. (2002). Globalization and its discontents. W.W. Norton & Company.
  17. Stern, D. I. (2004). The rise and fall of the environmental Kuznets curve. World Development, 32(8), 1419-1439.
  18. Suri, V., & Chapman, D. (1998). Economic growth, trade, and energy: Implications for the environmental Kuznets curve. Ecological Economics, 25(2), 195-208.
  19. Tilton, J. E. (1996). Exhaustible resources and sustainable development: Two different paradigms. Resources Policy, 22(1-2), 91-97.
  20. United Nations. (2015). Transforming our world: The 2030 Agenda for Sustainable Development. United Nations. https://sdgs.un.org/2030agenda
  21. Wackernagel, M., Onisto, L., Bello, P., Linares, A. C., Falfán, I. S. L., García, J. M., Guerrero, A. I. S., & Guerrero, M. G. S. (2002). National natural capital accounting with the ecological footprint concept. Ecological Economics, 29(3), 375-390.
  22. Wang, Q., Zhang, H., & Xie, H. (2018). The impact of economic growth on carbon emissions in China: Evidence from panel data. Environmental Economics and Policy Studies, 20(3), 423-437.
  23. Wiedmann, T., Lenzen, M., Turner, K., & Barrett, J. (2007). Examining the global environmental impact of trade: Incorporating ecological footprint analysis in the UK. Ecological Economics, 61(1), 70–81. https://doi.org/10.1016/j.ecolecon.2006.12.002
  24. Wiedmann, T., & Barrett, J. (2010). A review of the ecological footprint indicator—perceptions and methods. Sustainability, 2(6), 1645-1693.
  25. Wiedmann, T., & Lenzen, M. (2018). Environmental footprints of trade: Trends, drivers, and future prospects. Global Environmental Change, 50, 50-61.
  26. Wiedmann, T., Minx, J., Barrett, J., & Wackernagel, M. (2006). Allocating ecological footprints to final consumption categories with input–output analysis. Ecological Economics, 56(1), 28-48.
  27. World Bank. (2023). Pakistan development update: Restoring fiscal sustainability. World Bank Group. https://www.worldbank.org/en/country/pakistan/publication/pakistan-development-update
  28. York, R., Rosa, E. A., & Dietz, T. (2003). Footprints on the earth: The environmental consequences of modernity. American Sociological Review, 68(2), 279-300.
  29. York, R., Rosa, E. A., & Dietz, T. (2011). Ecological modernization theory: Theoretical challenges and prospects for policy implementation. Sociological Theory, 29(1), 101-128.