Investigating Economic Factors Affecting Air Pollution in Developing and Developed Countries; A Spatial Regime Model Approach

Abstract

The relationship between the variables e.g. economic growth, energy consumption, foreign direct investment, and the growth of pollution are complex issues, and important for the countries, which are planning a sustainable development strategy. On the other hand, considering the effects of geopolitical spillover on environmental economic issues, this paper studies the effective economic factors on carbon dioxide emissions in the developing and developed countries over the period 1993–2016, by employing the approach of the spatial regime panel. Results show that there are spatial effects and spatial heterogeneity between the variables. Accordingly, in this paper, we employed the regression approach of the spatial regime panel. Results show that the how variables affect the spatial regimes varies, and countries that have the structure of the first or second regime have different effects in terms of size and significance of the coefficients. So that in the study of the effect of spatial autoregression variable in the developing countries in the first spatial structure regime, there are neighboring effects of carbon dioxide emissions; while in the second spatial structure regime, there is no neighboring effects in the dependent variable.