Economic growth, energy consumption and environmental degradation nexus in heterogeneous countries: does education matter?

Abstract

Abstract Background Environmental concerns are growing globally. The world has suffered severe environmental deterioration over the years. Undeniably, the impact of environmental degradation on the earth’s geographical space is alarming, making environmental stakeholders to be worried. Existing literature has examined several factors affecting the environment, but the focus has now shifted to education and the need to maximize its potentials. Although studies have examined the direct impacts of education on the environment, those investigating its moderating role are relatively new and scarce, particularly across income groups. Understanding the channel through which education might affect the environment requires the knowledge of its moderating role. Therefore, this study employs FMOLS, DOLS, ARDL-PMG, CCEMG and heterogeneous panel causality test methodologies to investigate the direct and moderating effects of education in the growth-energy-environment linkages in heterogeneous income groups of 92 countries from 1985 to 2018. Results The findings of this study indicate that economic growth is a long-term solution to environmental deterioration in high and upper-middle-income countries, while the opposite holds for lower-middle-income and low-income countries. In addition, energy consumption is linked with environmental degradation across all income groups. Also, the study finds that education’s direct effects aggravate environmental degradation across all income groups. Moreover, its moderating role ameliorates the adverse effects of energy consumption on environmental degradation in high and upper-middle-income groups but worsens it in the lower-middle-income and low-income groups. Conclusion This study examines the role of education in economic growth, energy consumption and environmental degradation nexus. The study concludes that education is important for environmental sustainability as it encourages pro-environmental behaviors and attitudes and supports energy-efficient products and investments in green technologies. However, education may also aid energy-intensive activities and dirty technology by supporting lifestyles that are not eco-friendly. It is important, therefore, to provide education that promotes better environmental quality.