Impact of Human Development, Renewable Energy Consumption and Foreign Direct Investment on Environmental Degradation: Empirical Evidence from Argentina

Abstract

The main aim of the study was to examine the effects of human development, renewable energy consumption and foreign direct investment (FDI) on environmental pollution in Argentina. The analysis covers the 1990-2022 period. ARDL analysis was performed to determine whether the impact of variables on the environment differs in the short and long term. According to the analysis results, renewable energy consumption in Argentina in the long term increases environmental quality by reducing CO2 emissions. Although there is a negative relationship between FDI and CO2 emissions in the long term, this relationship is insignificant. Human development causes CO2 emissions to increase both in the short and long term, and the impact is quite high. The model’s error correction mechanism works. Deviations that occur between variables reach equilibrium in the next period. To combat environmental pollution, Argentina should implement policies that will increase the use of renewable energy. Although Argentina is a country rich in renewable energy potential, it is not able to use this potential. Wind, solar energy, and hydro energy potential are particularly high.

Keywords

• Environmental Degradation
• Human Development
• Renewable Energy
• Foreign Direct Investment
• ARDL Model

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