Abstract
Ensuring a balance between economic and ecological well-being has emerged as a key concern for governments worldwide. In the contemporary era, the global economies, especially the developing ones, emphasize the relevance of achieving eco-friendly growth whereby the ecological footprint figures are aimed to be contained alongside higher economic growth. However, in the majority of the cases, the developing countries are flourishing economically but are struggling to curb their ecological footprint levels. Against this backdrop, this study aimed to check whether or not technological innovation, natural resource consumption, globalization, economic growth, human capital development, and financial development influence the ecological footprint figures in 73 developing countries over the period from 1990 to 2016. Besides, to capture the possible heterogeneity of the outcomes, this study also conducted the analysis using sub-samples of countries belonging to the Asian, African, and Latin American and Caribbean regions. Moreover, in order to estimate the robust and reliable outcomes, this study employed the second-generation panel unit root and long-run cointegration tests. The overall results indicated that the variables have a mixed order of integration and are cointegrated. On the other hand, the long-run regression outcomes show that natural resource consumption significantly increases ecological footprint while technological innovations help to inhibit them. In addition, technological innovation was evidenced to exert a moderating effect to reduce the negative environmental consequences associated with natural resource consumption. Interestingly, these findings are homogenous for countries across all three regions. Also, globalization was witnessed to reduce the ecological footprint of African and Latin American countries only. Besides, the environmental Kuznets curve hypothesis is verified for the African and the Latin American and Caribbean nations but not for the cases of the Asian countries. Lastly, financial development was found to decrease ecological footprints overall, and for the Asian countries but not for the African and Latin American and Caribbean countries. Among the major policy recommendations, this study suggests the governments of the developing nations to adopt relevant policies regarding making efficient use of natural resources through technological innovations. In addition, the future human capital development, globalization, economic growth, and financial development policies should be aligned with the sustainable environmental development objectives.
•Macroeconomic determinants of EF in developing countries are evaluated.•Natural resources and financial development increase the EF.•Technological innovations reduce EF.•Technological innovation moderates between technological innovation and EF.•The EKC hypothesis for EF is valid for developing economies.