Driving Natural Resource Efficiency through environmental regulation, industry 4.0, international trade and FDI

Abstract

The accelerated industrial growth and economic expansion of Southeast Asian economies have intensified the concern related environmental issues and natural resource depletion. Amid these circumstances, the study finds an opportunity to investigate the key enabling factors that enhance natural resource efficiency. The research investigation sought to evaluate the association of natural resource efficiency with carbon mitigation, environmental regulation and Industry 4.0 in the context of Thailand, Malaysia and Vietnam. This panel dataset, obtained from various reputable sources, was then empirically analyzed using multiple tests. The cross-sectional independence test was carried out initially followed by the Pedroni cointegration test which validated the presence of long-term associations. Panel data estimation strategy comprised of using DCCE is also employed to reveal the association between variables. Findings of the study reveal a negative and significant impact of information and communication technology on natural resource efficiency. Environmental regulation was positively and significantly associated with total natural resources. Trade and FDI were also found to be positively associated with natural resource efficiency. These findings offer a comprehensive view to economies that how they can achieve environmental sustainability and industrial growth at the same time. This study is not only beneficial in terms of theoretical knowledge but it provides insights for policymakers and government on how natural resources can be managed.