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Quantile relationship between globalization, financial development, economic growth, and carbon emissions: evidence from Vietnam

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Abstract

Environmental quality and economic activity have a strong relationship. Carbon emissions remain one of the world’s most dangerous environmental issues. Both international and local governments are developing initiatives to address this problem. Capitalizing on the limitations of the existing literature, this article investigates the dynamic nexus of financial development, economic growth, and globalization on carbon dioxide emissions in Vietnam for 1990–2020 using the quantile-on-quantile regression. The findings unveil a positive feedback link between globalization and carbon dioxide emissions at the middle and high quantiles. In addition, there is a negative nexus between financial development and carbon emissions at most quantiles, while CO2 emissions and economic growth have a positive association at all quantiles. More importantly, our empirical results also provide the bidirectional causality between financial development, economic growth, globalization, and carbon dioxide emissions in Vietnam at different quantile levels. The consistency of the outcomes uncovers that the findings are trustworthy and appropriate for guiding policy to reduce CO2 emissions in Vietnam. Therefore, they can help policymakers understand how financial development and globalization can achieve sustainable economic growth and tackle environmental issues in this country.

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Funding

This research is funded by the University of Finance-Marketing, Ho Chi Minh City, Vietnam.

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  1. Faculty of Economics and Law, University of Finance-Marketing, Ho Chi Minh, Vietnam

    Ngo Thai Hung

  2. International School of Finance-Marketing, University of Finance-Marketing, Ho Chi Minh, Vietnam

    Nguyen Thu Trang & Nguyen Thanh Thang

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  1. Ngo Thai Hung
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NTH: Writing—original draft, Formal analysis, Conceptualization, Supervision. NTT: Writing—literature review. NTT: Methodology section.

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Correspondence to Ngo Thai Hung.

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Hung, N.T., Trang, N.T. & Thang, N.T. Quantile relationship between globalization, financial development, economic growth, and carbon emissions: evidence from Vietnam. Environ Sci Pollut Res 29, 60098–60116 (2022). https://doi.org/10.1007/s11356-022-20126-z

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