Abstract
As economies continue to grow in the face of global climate change, international policy is focusing on the combined pursuit of social and environmental development, or ‘sustainable development goals’. Whilst such goals are often framed from the perspective of high-income countries, low-income countries struggle to balance their carbon-intensive growth strategies with poverty alleviation, and carbon emission reduction. Combined with the prospect of economic growth driving income inequality higher, the potential for a vicious cycle to emerge in low-income countries in particular is considerable. Whilst the negative association between economic growth and poverty is well established, the effectiveness of growth-based programmes as a poverty reduction strategy in the context of climate change and inequality is less certain. We explore the prospects of balancing these development goals and their consequences using an international dataset, and generalized method of moments estimators. We find that although economic development reduces poverty, carbon emissions (from carbon-intensive growth) coupled with inequality, exacerbates poverty. Secondly, we find that in terms of poverty reduction, poor countries are negatively impacted by both carbon emissions and income inequality, while rich countries are primarily impacted by income inequality. Finally, we find the effect of emissions on poverty is stronger for countries at higher poverty levels, suggesting that international policies aimed at achieving equitable emissions reduction should consider the potential for disproportionate negative impacts on poorer countries.
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Please see Appendix A. Data and variable definitions.
Abbreviations
- 3SLS:
-
Three-stage least square estimator;
- AR2:
-
Arellano–bond test for serial correlation at order two
- EKC:
-
Environmental kuznets curve
- GDP:
-
Gross domestic product
- GDPPC:
-
GDP per capita
- GINI:
-
Income inequality index
- GMM:
-
Generalized method of moments
- IKC:
-
Inequality Kuznets curve
- IPCC:
-
Intergovernmental panel on climate change
- PCSE:
-
Panel-corrected standard error estimates
- SDG:
-
Sustainable development goals
- USGCRP:
-
U.S. global change research program
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The author is grateful to all editors of the journal for their useful and constructive comments to revise this article.
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The research conducted in this publication was funded by the Irish Research Council under award number GOIPG/2021/441.
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Q-KD: Conceptualization, data curation, formal analysis, methodology, and writing—original draft; and EF: Writing (10% approximately), editing (redrafting of final manuscript), structure (organization of sections).
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Appendices
Appendices
1.1 Appendix A: Data and variable definitions
Variables | Definitions |
|---|---|
Inequality | Gini index (World Bank estimate) |
Emissions | Carbon emissions (metric tons per capita) |
GDPPC | GDP per capita, PPP (constant 2017 international $) |
Poverty190 | Poverty headcount ratio at $1.90 a day (2011 PPP) (% of population) |
Poverty320 | Poverty headcount ratio at $3.20 a day (2011 PPP) (% of population) |
Poverty550 | Poverty headcount ratio at $5.50 a day (2011 PPP) (% of population) |
Poverty190-320 | Difference between Poverty320 and Poverty190 |
Poverty320-550 | Difference between Poverty550 and Poverty320 |
Population | Population, total |
Renew. cnsmp | Renewable energy consumption (% of total final energy consumption) |
Urbanization | Urban population (% of total population) |
1.2 Appendix B: List of countries under this study
Code | Long name | Income group |
|---|---|---|
AFG | Islamic State of Afghanistan | Low income |
ALB | Republic of Albania | Low income |
DZA | People's Democratic Republic of Algeria | Low income |
ASM | American Samoa | Low income |
AND | Principality of Andorra | High income |
AGO | People's Republic of Angola | Low income |
ATG | Antigua and Barbuda | High income |
ARG | Argentine Republic | Low income |
ARM | Republic of Armenia | Low income |
ABW | Aruba | High income |
AUS | Commonwealth of Australia | High income |
AUT | Republic of Austria | High income |
AZE | Republic of Azerbaijan | Low income |
BHS | Commonwealth of The Bahamas | High income |
BHR | Kingdom of Bahrain | High income |
BGD | People's Republic of Bangladesh | Low income |
BRB | Barbados | High income |
BLR | Republic of Belarus | Low income |
BEL | Kingdom of Belgium | High income |
BLZ | Belize | Low income |
BEN | Republic of Benin | Low income |
BMU | The Bermudas | High income |
BTN | Kingdom of Bhutan | Low income |
BOL | Plurinational State of Bolivia | Low income |
BIH | Bosnia and Herzegovina | Low income |
BWA | Republic of Botswana | Low income |
BRA | Federative Republic of Brazil | Low income |
VGB | British Virgin Islands | High income |
BRN | Brunei Darussalam | High income |
BGR | Republic of Bulgaria | Low income |
BFA | Burkina Faso | Low income |
BDI | Republic of Burundi | Low income |
CPV | Republic of Cabo Verde | Low income |
KHM | Kingdom of Cambodia | Low income |
CMR | Republic of Cameroon | Low income |
CAN | Canada | High income |
CYM | Cayman Islands | High income |
CAF | Central African Republic | Low income |
TCD | Republic of Chad | Low income |
CHI | Channel Islands | High income |
CHL | Republic of Chile | High income |
CHN | People's Republic of China | Low income |
COL | Republic of Colombia | Low income |
COM | Union of the Comoros | Low income |
COD | Democratic Republic of the Congo | Low income |
COG | Republic of Congo | Low income |
CRI | Republic of Costa Rica | Low income |
CIV | Republic of Côte d'Ivoire | Low income |
HRV | Republic of Croatia | High income |
CUB | Republic of Cuba | Low income |
CUW | Curaçao | High income |
CYP | Republic of Cyprus | High income |
CZE | Czech Republic | High income |
DNK | Kingdom of Denmark | High income |
DJI | Republic of Djibouti | Low income |
DMA | Commonwealth of Dominica | Low income |
DOM | Dominican Republic | Low income |
ECU | Republic of Ecuador | Low income |
EGY | Arab Republic of Egypt | Low income |
SLV | Republic of El Salvador | Low income |
GNQ | Republic of Equatorial Guinea | Low income |
ERI | State of Eritrea | Low income |
EST | Republic of Estonia | High income |
SWZ | Kingdom of Eswatini | Low income |
ETH | Federal Democratic Republic of Ethiopia | Low income |
FRO | Faroe Islands | High income |
FJI | Republic of Fiji | Low income |
FIN | Republic of Finland | High income |
FRA | French Republic | High income |
PYF | French Polynesia | High income |
GAB | Gabonese Republic | Low income |
GMB | Republic of The Gambia | Low income |
GEO | Georgia | Low income |
DEU | Federal Republic of Germany | High income |
GHA | Republic of Ghana | Low income |
GIB | Gibraltar | High income |
GRC | Hellenic Republic | High income |
GRL | Greenland | High income |
GRD | Grenada | Low income |
GUM | Guam | High income |
GTM | Republic of Guatemala | Low income |
GIN | Republic of Guinea | Low income |
GNB | Republic of Guinea-Bissau | Low income |
GUY | Co-operative Republic of Guyana | Low income |
HTI | Republic of Haiti | Low income |
HND | Republic of Honduras | Low income |
HKG | Hong Kong (China) | High income |
HUN | Hungary | High income |
ISL | Republic of Iceland | High income |
IND | Republic of India | Low income |
IDN | Republic of Indonesia | Low income |
IRN | Islamic Republic of Iran | Low income |
IRQ | Republic of Iraq | Low income |
IRL | Ireland | High income |
IMN | Isle of Man | High income |
ISR | State of Israel | High income |
ITA | Italian Republic | High income |
JAM | Jamaica | Low income |
JPN | Japan | High income |
JOR | Hashemite Kingdom of Jordan | Low income |
KAZ | Republic of Kazakhstan | Low income |
KEN | Republic of Kenya | Low income |
KIR | Republic of Kiribati | Low income |
PRK | Democratic People's Republic of Korea | Low income |
KOR | Republic of Korea | High income |
XKX | Republic of Kosovo | Low income |
KWT | State of Kuwait | High income |
KGZ | Kyrgyz Republic | Low income |
LAO | Lao People's Democratic Republic | Low income |
LVA | Republic of Latvia | High income |
LBN | Lebanese Republic | Low income |
LSO | Kingdom of Lesotho | Low income |
LBR | Republic of Liberia | Low income |
LBY | Socialist People's Libyan Arab Jamahiriya | Low income |
LIE | Principality of Liechtenstein | High income |
LTU | Republic of Lithuania | High income |
LUX | Grand Duchy of Luxembourg | High income |
MAC | Macao (China) | High income |
MDG | Republic of Madagascar | Low income |
MWI | Republic of Malawi | Low income |
MYS | Malaysia | Low income |
MDV | Republic of Maldives | Low income |
MLI | Republic of Mali | Low income |
MLT | Republic of Malta | High income |
MHL | Republic of the Marshall Islands | Low income |
MRT | Islamic Republic of Mauritania | Low income |
MUS | Republic of Mauritius | Low income |
MEX | United Mexican States | Low income |
FSM | Federated States of Micronesia | Low income |
MDA | Republic of Moldova | Low income |
MCO | Principality of Monaco | High income |
MNG | Mongolia | Low income |
MNE | Montenegro | Low income |
MAR | Kingdom of Morocco | Low income |
MOZ | Republic of Mozambique | Low income |
MMR | Republic of the Union of Myanmar | Low income |
NAM | Republic of Namibia | Low income |
NRU | Republic of Nauru | High income |
NPL | Nepal | Low income |
NLD | Kingdom of the Netherlands | High income |
NCL | New Caledonia | High income |
NZL | New Zealand | High income |
NIC | Republic of Nicaragua | Low income |
NER | Republic of Niger | Low income |
NGA | Federal Republic of Nigeria | Low income |
MKD | Republic of North Macedonia | Low income |
MNP | Commonwealth of the Northern Mariana Islands | High income |
NOR | Kingdom of Norway | High income |
OMN | Sultanate of Oman | High income |
PAK | Islamic Republic of Pakistan | Low income |
PLW | Republic of Palau | High income |
PAN | Republic of Panama | Low income |
PNG | The Independent State of Papua New Guinea | Low income |
PRY | Republic of Paraguay | Low income |
PER | Republic of Peru | Low income |
PHL | Republic of the Philippines | Low income |
POL | Republic of Poland | High income |
PRT | Portuguese Republic | High income |
PRI | Puerto Rico | High income |
QAT | State of Qatar | High income |
ROU | Romania | Low income |
RUS | Russian Federation | Low income |
RWA | Republic of Rwanda | Low income |
WSM | Samoa | Low income |
SMR | Republic of San Marino | High income |
STP | Democratic Republic of São Tomé and Principe | Low income |
SAU | Kingdom of Saudi Arabia | High income |
SEN | Republic of Senegal | Low income |
SRB | Republic of Serbia | Low income |
SYC | Republic of Seychelles | High income |
SLE | Republic of Sierra Leone | Low income |
SGP | Republic of Singapore | High income |
SXM | Sint Maarten (Dutch part) | High income |
SVK | Slovak Republic | High income |
SVN | Republic of Slovenia | High income |
SLB | Solomon Islands | Low income |
SOM | Somali Democratic Republic | Low income |
ZAF | Republic of South Africa | Low income |
SSD | Republic of South Sudan | Low income |
ESP | Kingdom of Spain | High income |
LKA | Democratic Socialist Republic of Sri Lanka | Low income |
KNA | St. Kitts and Nevis | High income |
LCA | St. Lucia | Low income |
MAF | St. Martin (French part) | High income |
VCT | St. Vincent and the Grenadines | Low income |
SDN | Republic of the Sudan | Low income |
SUR | Republic of Suriname | Low income |
SWE | Kingdom of Sweden | High income |
CHE | Switzerland | High income |
SYR | Syrian Arab Republic | Low income |
TJK | Republic of Tajikistan | Low income |
TZA | United Republic of Tanzania | Low income |
THA | Kingdom of Thailand | Low income |
TLS | Democratic Republic of Timor-Leste | Low income |
TGO | Republic of Togo | Low income |
TON | Kingdom of Tonga | Low income |
TTO | Republic of Trinidad and Tobago | High income |
TUN | Republic of Tunisia | Low income |
TUR | Republic of Turkey | Low income |
TKM | Turkmenistan | Low income |
TCA | Turks and Caicos Islands | High income |
TUV | Tuvalu | Low income |
UGA | Republic of Uganda | Low income |
UKR | Ukraine | Low income |
ARE | United Arab Emirates | High income |
GBR | United Kingdom of Great Britain and Northern Ireland | High income |
USA | United States of America | High income |
URY | Oriental Republic of Uruguay | High income |
UZB | Republic of Uzbekistan | Low income |
VUT | Republic of Vanuatu | Low income |
VEN | República Bolivariana de Venezuela | Low income |
VNM | Socialist Republic of Vietnam | Low income |
VIR | Virgin Islands of the United States | High income |
PSE | West Bank and Gaza | Low income |
YEM | Republic of Yemen | Low income |
ZMB | Republic of Zambia | Low income |
ZWE | Republic of Zimbabwe | Low income |
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Duong, K., Flaherty, E. Does growth reduce poverty? The mediating role of carbon emissions and income inequality. Econ Change Restruct 56, 3309–3334 (2023). https://doi.org/10.1007/s10644-022-09462-9
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DOI: https://doi.org/10.1007/s10644-022-09462-9