The Impact of Social Inclusion and Financial Development on CO2 Emissions: Panel Analysis from Developing Countries

The intricate interplay between the environment and the economy entails numerous multifaceted factors that require thorough investigation. Civic activism, intergroup cohesion, and gender equality are among the pertinent factors that hold the potential to significantly impact CO2 emissions in developing economies. However, these variables have not been explored to the extent that their importance warrants, leaving much to be studied and understood about their complex relationships with carbon emissions. Currently, developing nations find themselves more vulnerable and exposed to a plethora of environmental issues. In response to this pressing matter, the focus of this study is to expound upon the impact of various factors on the environment. To achieve this aim, this study utilizes annual data from 46 developing countries, spanning the extensive period from 1990 to 2014. Using the generalized method of moments and empirical Bayes methods, this study’s results emphasize the significant impact that civic activism, gender equality, intergroup cohesion, and financial development can have on increasing CO2 emissions. However, civic activism reduces CO2 emissions. These findings highlight the crucial importance of adopting a comprehensive approach that accounts for both economic and social cohesion indicators when tackling environmental challenges.