Applying the forest load capacity factor to assess environmental sustainability in the Global South

Forests play a critical role in achieving environmental sustainability because they absorb polluting waste from anthropogenic activities and produce biomass. However, the forest load capacity of developing countries has deteriorated due to the overload of unregulated economic activities. This study examines the determinants of environmental sustainability, as measured by the forest load capacity factor, in countries of the Global South. The factors considered are GDP per capita, governance, gender inequality index, women's political empowerment, youth unemployment, and the informal sector. The study covers the period 1991–2022, and we employ a suite of advanced panel data models. The econometric strategy includes cointegration techniques with structural breaks, long-run elasticities, quantile regressions, and causality models. The findings show that environmental sustainability exhibits a cointegrating relationship with the regressors when considering structural breaks in the series resulting from external and internal shocks. We also show that the regressors have a heterogeneous effect on environmental sustainability across the distribution. The estimators differ between sustainable and non-sustainable countries in the Global South. The results of the causality test show that environmental sustainability has a structural relationship with GDP per capita, governance, women's political empowerment, and informal sector This research contributes to the debate on environmental sustainability by covering a large sample of developing countries, and we consider the role of gender in the pursuit of Sustainable Development Goals 13 and 15. • Informality, youth employment, quality of governance, and forest load capacity factor nexus is examined. • The relation was moderated by the index of gender inequality and women's political empowerment. • We found a cointegration relationship between the series in the presence of structural breaks. • The regressors have a heterogeneous impact on the forest load capacity factor across the distribution.