This paper aligns with the United Nations guidelines and is associated with the objectives of sustainable development, focusing more specifically on the social dimension and the individual, to protect them against pollution. Beyond a certain threshold of CO2 emissions, the individual will be subjects to diseases and become unable of creating wealth by applying new knowledge. The purpose of this paper is to study the effects of carbon dioxide emissions (CO2) on the human development index (HDI), seeking to endogenously determine the optimal CO2 threshold beyond which HDI is affected. Existing studies have produced conflicting results and can be divided into two groups. The first group shows the harmful impacts of CO2 emissions on HDI. While, the second one reveals that the HDI can increase with these emissions. To achieve this aim, we selected the top 54 most polluting countries in the world observed over the period 2002–2018, and we referred to the non-linear model (Panel Smooth Threshold Regression PSTR) developed by González, A., Teräsvirta, T., & Van Dijk, D. (2005) Panel smooth transition regression models. SSE/EFI Working Paper Series in Economics and Finance 604, Stockholm School of Economics, which includes the following control variables: financial development, investment, foreign direct investments, trade openness, population growth, and regulatory quality. The results found combine the two opposing findings and show that the impacts of CO2 on HDI depend on a threshold effect beyond which these impacts are reversed. More importantly, these results verify the null hypothesis and show that the effects of CO2 on HDI take the shape of an inverted U and that the optimal threshold of CO2 emissions is estimated to be 5.5635 metric tons per capita. Contrary to their positive impact in a low regime, CO2 emissions become harmful to human development in a high regime. The estimated optimal threshold can serve as a reference for selected countries, which should prioritize human beings when they implement their environmental policies. Countries in a high regime are required to use renewable energies, green technologies, and transfer part of their activities to the least polluted countries. These recommendations should have been more detailed if we had taken CO2 emissions’ origins and data were available for selected countries over a long period. This is why we relied on an unbalanced panel. In future research, we will examine the effects of CO2 emissions’ origins on HDI using other econometric approaches, and look for the causes of the insignificant effect of foreign direct investments on HDI.

Nonlinear Effect of Carbon Dioxide Emissions on Human Development: Endogenous Determination of the Optimal Threshold

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发表日期：

2025年7月14日

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Khemais Zaghdoudi

摘要

This paper aligns with the United Nations guidelines and is associated with the objectives of sustainable development, focusing more specifically on the social dimension and the individual, to protect them against pollution. Beyond a certain threshold of CO₂ emissions, the individual will be subjects to diseases and become unable of creating wealth by applying new knowledge. The purpose of this paper is to study the effects of carbon dioxide emissions (CO₂) on the human development index (HDI), seeking to endogenously determine the optimal CO₂ threshold beyond which HDI is affected. Existing studies have produced conflicting results and can be divided into two groups. The first group shows the harmful impacts of CO₂ emissions on HDI. While, the second one reveals that the HDI can increase with these emissions. To achieve this aim, we selected the top 54 most polluting countries in the world observed over the period 2002–2018, and we referred to the non-linear model (Panel Smooth Threshold Regression PSTR) developed by González, A., Teräsvirta, T., & Van Dijk, D. (2005) Panel smooth transition regression models. SSE/EFI Working Paper Series in Economics and Finance 604, Stockholm School of Economics, which includes the following control variables: financial development, investment, foreign direct investments, trade openness, population growth, and regulatory quality. The results found combine the two opposing findings and show that the impacts of CO₂ on HDI depend on a threshold effect beyond which these impacts are reversed. More importantly, these results verify the null hypothesis and show that the effects of CO₂ on HDI take the shape of an inverted U and that the optimal threshold of CO₂ emissions is estimated to be 5.5635 metric tons per capita. Contrary to their positive impact in a low regime, CO₂ emissions become harmful to human development in a high regime. The estimated optimal threshold can serve as a reference for selected countries, which should prioritize human beings when they implement their environmental policies. Countries in a high regime are required to use renewable energies, green technologies, and transfer part of their activities to the least polluted countries. These recommendations should have been more detailed if we had taken CO₂ emissions’ origins and data were available for selected countries over a long period. This is why we relied on an unbalanced panel. In future research, we will examine the effects of CO₂ emissions’ origins on HDI using other econometric approaches, and look for the causes of the insignificant effect of foreign direct investments on HDI.