The relationship between transport, economic growth and environmental degradation for ninety countries

Abstract

This paper examines the relationship between freight transport, economic growth, and environmental degradation (CO₂ emissions) across ninety countries from 1980 to 2014. The analysis is divided into five groups: the global panel, high-income countries, upper-middle-income countries, lower-middle-income countries, and lower-income countries. This study employs a Simultaneous Equation Model, estimated using the Three-Stage Least Squares (3SLS) method. The results reveal a bi-directional causal relationship between economic growth and freight transport in both high-income and lower-income countries. Additionally, the findings indicate a bi-directional causality between transportation and CO₂ emissions in upper-middle-income countries. Lastly, a bi-directional causality between economic growth and CO₂ emissions is observed in lower-middle-income countries.