Militarization, industrial progress, and their carbon footprints in North Atlantic Treaty Organization countries: a panel econometric analysis

Abstract This study uniquely explores the impact of militarization on carbon emissions in North Atlantic Treaty Organization (NATO) countries from 1985 to 2019 using panel econometric techniques. NATO countries, characterized by substantial defense budgets, advanced technologies, high industrialization, and significant energy consumption, offer a unique context for examining these factors. Employing the Pooled Mean Group Autoregressive Distributed Lag (PMG-ARDL) and FMOLS models, the research analyzes the long-term and short-term dynamics across three groups: traditional NATO members (Group 1), new NATO members (Group 2), and a combined group (Group 3). Relevant variables used in the estimation are industrialization, technological innovation, energy consumption, and economic growth. Findings reveal that in Group 1, military expenditure and energy consumption significantly increase carbon emissions, while industrialization and technological innovation reduce them. In Group 2, increased military spending and industrialization reduce emissions, but energy consumption and technological innovation increase them. For Group 3, economic growth significantly drives emissions, whereas industrial advancements and selective technological innovations mitigate them. The study underscores the need for tailored environmental policies and technological advancements to reduce carbon emissions, contributing to sustainable development within military alliances. These insights are crucial for policymakers aiming to balance defense needs with environmental sustainability in NATO countries.