Aggregate and disaggregate natural resources impacts on environmental sustainability: An Asymmetric NARDL analysis

While many studies have explored the relationship between aggregate natural resource rents and environmental sustainability, understanding the broader impact of TNRR on the ecological footprint remains critical. However, focusing solely on the aggregate measure may obscure the distinct effects of different types of natural resources on environmental outcomes. This study bridges that gap by analyzing not only the aggregate effect of TNRR on EF but also the disaggregated impacts of different types of natural resource rents —oil, gas, minerals, coal, and forests—on EF in Algeria between 1970/Q1 and 2022/Q4, Applying nonlinear autoregressive distributed lag (NARDL) models. Our results reveal a non-symmetric impact of aggregate TNRR in Algeria's ecological footprint, with positive shocks significantly increasing EF and negative shocks decreasing it. The disaggregated analysis uncovers nuanced sector-specific dynamics: oil rents mirror the asymmetric pattern of aggregate TNRR, while gas and mineral rents increase EF regardless of shock direction. Coal rents show no significant impact, and forest rents demonstrate a sharp increase in EF with positive shocks and a reduction with negative shocks. These results underscore the need for a differentiated approach to resource management in Algeria, emphasizing economic diversification, promotion of cleaner energy alternatives, and sustainable forest management practices.