An Empirical Analysis of the Inverted-U Shape Relationship Between Globalization and Environmental Degradation: Based on Environmental Kuznets Curve

Yuheng Sun

doi:10.54691/v5tkc739

Authors

Yuheng Sun

DOI:

https://doi.org/10.54691/v5tkc739

Keywords:

Globalization, Environmental Degradation, Weighted Entropy Method, Human Capital, EKC Hypothesis.

Abstract

This study aims to fill the gaps in existing research on the relationship between environmental degradation and globalization by analyzing panel data collected from 130 countries between 1996 and 2021. Based on the Environmental Kuznets Curve (EKC) framework, the analysis explores whether globalization initially causes environmental harm but turns to improve it after a certain threshold. Both baseline results and robustness checks indicate a significant inverted U-shaped relationship. However, by examining regional heterogeneity, this study finds differences in coefficients and significance levels across continents. This study further examines the moderating role of human capital and finds out that higher levels of education and skills enhance a country's ability to benefit from globalization, thereby altering the turning point and slope of the curve. This study also offers useful policy implications for stakeholders, demonstrating that the environmental effects of globalization are not automatic but conditional.

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