Determinants of environmental pollution in Turkey: Cointegration and causality analysis (1980 - 2017)

Developments such as climate change, forest fires, and sea-level rise that have emerged with global warming have drawn attention to the concept of sustainable development. Scientists draw attention to the dangers that await the world in the future if the necessary precautions are not taken. This issue is essential in determining the framework of the concept of sustainable development and requires addressing the dynamics that impact environmental pollution. This research is aimed to examine the determinants of environmental pollution in Turkey in the period of 1980-2017. For this reason, the effect on carbon dioxide (CO2) emissions were analyzed in the research: economic growth, non-renewable energy consumption, renewable energy consumption, industrialization, trade openness, foreign direct investment (FDI), financial development, population density, urbanization, patent application, agricultural added value, farmland, globalization, economic globalization, financial globalization, social globalization, and political globalization. To determine the cointegration relationship, the Autoregressive Lag Distributed Model (ARDL) bounds testing approach was used in this study. A long-term cointegration relationship has been detected in all models due to the bounds testing system. However, it has been determined that the long-term effects of economic growth, non-renewable energy consumption, industrialization, trade openness, FDI, financial development, population density, urbanization, globalization (general), economic globalization, financial globalization, and social globalization on CO2 emissions are positive. In addition, it has been concluded that the effect of renewable energy consumption, patent application, agricultural added value, and political globalization on CO2 emissions is negative. In the analyzes in which the validity of the Environmental Kuznets Curve Hypothesis (EKC), Pollution Haven Hypothesis, and Pollution Halo Hypotheses were tested, it was concluded that the EKC Hypothesis and Pollution Haven Hypothesis were valid in Turkey. Finally, this research examined the causal relationships between environmental pollution and its determinants with the Toda-Yamamoto Causality Test. As a result of this analysis, bidirectional causality was observed between CO2 emissions with non-renewable energy consumption, trade openness, population density, urbanization, farmland, and social globalization. On the other hand, one-way causality has been determined from renewable energy consumption, FDI, financial development, industrialization, globalization, economic globalization, financial globalization, and political globalization to CO2 emissions. However, a definite judgment could not be reached regarding the direction of causality between economic growth, agricultural added value and patent and CO2 emissions.