Causality of Environmental Degradation and Economic Growth in Indonesia

Sri Rahayu Budi Hastuti *

UPN Veteran Yogyakarta, Jl. SWK 104, Condongcatur, Depok, Sleman, Yogyakarta, 55283, Indonesia.

Didit Welly Udjianto

UPN Veteran Yogyakarta, Jl. SWK 104, Condongcatur, Depok, Sleman, Yogyakarta, 55283, Indonesia.

Rini Dwi Astuti

UPN Veteran Yogyakarta, Jl. SWK 104, Condongcatur, Depok, Sleman, Yogyakarta, 55283, Indonesia.

Ilyasin Aditya Rahman

UPN Veteran Yogyakarta, Jl. SWK 104, Condongcatur, Depok, Sleman, Yogyakarta, 55283, Indonesia.

*Author to whom correspondence should be addressed.


Abstract

Nowdays, the issue of global warming is being widely discussed in all countries, both developed and developing countries, because of its negative impact on the environment. This study aims to develop an integrated analytical framework of causality between energy consumption, carbon emissions, financial development, trade openness, and economic growth in Indonesia, 1990-2021. This study provides research benefits in the form of a set of empirical evidence to assist in developing a series of key strategies that can improve environmental quality through sustainable development. With granger causality analysis and vector autoregression model, this study provides results that high economic growth and energy consumption can cause environmental degradation through increased carbon gas emissions.

Keywords: Environmental degradation, financial development, trade openness, economic growth


How to Cite

Hastuti, Sri Rahayu Budi, Didit Welly Udjianto, Rini Dwi Astuti, and Ilyasin Aditya Rahman. 2024. “Causality of Environmental Degradation and Economic Growth in Indonesia”. International Journal of Environment and Climate Change 14 (7):364-70. https://doi.org/10.9734/ijecc/2024/v14i74277.

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