The Impact of Democratization and Globalization on Environmental Sustainability in Brazil

ABSTRACT Although Brazil still possesses significant ecological reserves, the surplus in its biocapacity has been rapidly declining in recent years. This study examines the relationship between environmental sustainability and key economic, political, and energy‐related factors in Brazil from 1990 to 2018. The primary motivation behind the research is to explore the potential associations between Brazil's declining biocapacity and various economic and political dynamics, thereby providing insights that may inform sustainability efforts. The study tests the hypothesis that economic growth leads to environmental degradation or improvement, employing Fourier‐augmented Dickey‐Fuller and Fourier Autoregressive Distributed Lag (ARDL) approaches. The findings reveal that economic growth negatively impacts environmental sustainability in both the short and long term, rendering the Inverted Load Capacity Curve Hypothesis (ILCCH) invalid, as the long‐term coefficient of economic growth is larger than the short‐term one. Additionally, the study highlights that democratisation positively affects environmental sustainability, while economic globalisation exacerbates environmental conditions. Based on the findings, it is concluded that Brazil, as a resource‐dependent economy, needs to reassess the environmental costs of its growth and globalisation strategies. The study emphasises the importance of aligning economic growth strategies with environmentally friendly policies to ensure sustainable long‐term growth in Brazil.