Dynamic impact of economic growth, energy use, foreign direct investment and population on greenhouse gas emission in Bangladesh

Abstract

Currently, climate change is a burning concern all over the world. It is causing immense pressure on the economy of developing countries due to the adverse climatic events caused by climate change. Greenhouse gas (GHG) emission, being the top justification for causing climate change, has been the center of concern over the years. This study sheds light on how economic advancement, energy use, and foreign direct investment (FDI) coupled with population might influence the emission of GHGs in Bangladesh. The cointegrating relationship among the factors was established via the Autoregressive Distributed Lag (ARDL) bounds test and Johansen cointegration test before performing the regression analysis. The ARDL short- and long-run approach alongside the Dynamic Ordinary Least Squares (DOLS) procedure was implemented to see how each independent variable impacts the emission of GHGs between 1990 and 2019. The ARDL estimation reveals that a 1 % intensification in energy use, economic progress, and population increases GHG emissions by 0.76 %, 0.18 %, and 0.28 %, respectively, in the long run, while a 1 % upsurge in foreign direct FDI reduces emissions of GHGs by 0.07 % in the long run. This outcome will advocate for Bangladesh's policymakers to establish a better platform in future global climate change negotiations.