MANAGING ENVIRONMENTAL QUALITY IN THAILAND: EXAMINING THE ROLE OF TRADE AND FINANCIAL DEVELOPMENT

Abstract

In the past few decades, greenhouse gases and global warming has attracted the attention of the world because it is the main reason of unwanted climate changes. This research highlighted the trade and financial development effects on the quality of the environment in the context of Thailand. The data were analyzed from 1970 to 2018 with the help of the autoregressive distributed lag model. All the variables, as mentioned earlier, are analyzed and the short and the long-run relationship were also observed. Furthermore, different pollutants were analyzed with the help of the Kuznets Environmental Curve (EKC) hypothesis. The outcome of this study reflects that environmental degradation is accelerated with financial development. However, environmental degradation is reduced when trade openness increases. Additionally, the EKC hypothesis is not validated for Thailand due to the fact that economic expansion also boosts the level of carbon emission which ultimately harms the environment. So, Thailand’s government needs to improve the innovation of technology which is increased by the level of financial development that helps to reduce the carbon emission level and make the environment healthy and clean