Nexus between institutional quality, economic openness, and environmental quality: New evidence from the MENA region

Abstract The paper uses the CS-ARDL approach to analyze the impact of institutional quality, economic openness, population growth, and GDP per capita on environmental quality in 12 countries of the MENA region for the period of 1997–2023. We find that institutional quality, economic openness, and environmental quality move together in both the short and long term, but with different speeds of adjustment. The results show that economic openness, population growth, and gross domestic product per capita strongly affect environmental quality in the MENA region. In contrast, economic openness in developed economies has a positive impact on environmental quality in both the short and long term. However, population growth and gross domestic product per capita have a strong impact on environmental quality in both developed and developing countries in the short and long term. Additionally, results for the North and Middle East regions remain robust. The heterogeneity of results for developed, developing, North, and Middle East regions suggests strong policy recommendations for improving the environmental quality to achieve sustainable development.