Does economic transition enhance environmental sustainability? The case of Russia

Abstract

All countries, especially those with high carbon dioxide (CO2) emissions, have faced environmental problems in recent years. Therefore, making efforts to ensure a decline in CO2 emissions is inevitable for countries. Accordingly, this study examines environmental sustainability (ES) in Russia, which takes place among the top five emitting countries by focusing on the economic transition structure because of the fact the Russian economy has begun to transform its economy into a market-oriented economy and integrate into global markets with the collapse of the former Soviet Union in the latter part of 1991. This is important because the environmental implications of economic transformation have been largely ignored in the literature, whereas the political and welfare impacts of economic transformation have been widely discussed. Hence, the study aims to investigate how economic change affected ES Russia from 1960 to 2018 by considering the role of income and population and applying the ARDL method as the main model and both FMOLS and DOLS methods for the robustness check. The empirical results show that (i) economic growth increases environmental pollution; (ii) economic growth square decreases environmental pollution; (iii) hence, the validity of the environmental Kuznets curve (EKC) is confirmed; (iv) a rise in population causes an increase in environmental pollution; (v) the alternative econometric approaches prove the robustness of the empirical results. So, the empirical results imply that Russia’s economic transition has the potential to promote environmental sustainability by decreasing CO2 emissions.