Exploring the Environmental Impact of Energy Consumption, Globalization, and Research & Development in Europe: Insights from the STIRPAT-EKC Framework

Abstract This paper investigates the relationships between GDP, population, fossil fuel, renewable energy consumption, globalization, research and development (R&D) expenditure, and ecological footprint in 25 European nations from 1990 to 2021. To investigate the environmental impact, the research bridging two famous framework, Environmental Kuznets Curve (EKC) and Strategic Impacts on Population, Affluence, and Technology (STIRPAT) models. Due to cross sectional dependency and slope heterogeneity the research applied cross-sectional autoregressive distributive model (CS-ARDL). The research applied two types of robustness checks- applying different dependent variable, CO2 instead of ecological footprint. Also, applied different estimator, Augmented Mean Group (AMG), Mean Group (MG), and common correlated effects mean group (CCEMG) estimators. The findings suggest the existence of an inverted U-shaped EKC relationship between income and ecological footprint, indicating that an increase in income initially leads to a rise in ecological footprint but eventually declines beyond a certain threshold due to environmental awareness and policy measures. Furthermore, green energy consumption and R&D expenditure have significant negative relationships with an ecological footprint, implying that promoting renewable energy sources and investing in R&D can help mitigate environmental degradation. The impact of globalization on ecological footprint is inconclusive, as different measures of globalization yield mixed results across the three approaches. This study contributes to the existing literature by utilizing multiple econometric approaches to examine the STIRPAT-EKC relationships, incorporating various determinants of ecological footprint in the European context. The findings provide policymakers with insights into designing effective environmental policies and strategies that balance economic growth, energy consumption, and ecological sustainability.