The effect of energy consumption, urbanization, trade openness, industrial output, and the political stability on the environmental degradation in the MENA (Middle East and North African) region

Abstract

The main goal of this study is to examine the events that caused the environmental degradation in the MENA (Middle East and North African) region. To achieve the goal of this study, a panel model that represents the environmental degradation utilizing ecological footprint as a better indicator is constructed taken the period 1996-2012 investigating 14 MENA countries. The results from the Pedroni cointegration test revealed that ecological footprint, energy consumption, urbanization, trade openness, industrial development and political stability are cointegrated. Moreover, the results of FMOLS (fully modified ordinary least square) concluded that energy consumption, urbanization, trade openness and industrial development increases environmental damage while the political stability lessens it in the long run. In addition, the Granger causality revealed that the used variables have short run and long run causal relationship with the ecological footprint. Moreover, different directions of causal relationship were found between the variables. According to the outcomes of this study, a number of policy recommendations were provided for the MENA countries that can help them to reduce their environmental degradation.