Exploring the Impacts of Economic Growth on Ecosystem and Its Subcomponents in Turkiye

Abstract

This study analyzes the impacts of economic growth on ecosystem in Turkiye. The study uses annual data for the period 1995-2021 and the ARDL method. The study utilizes the Ecosystem Vitality Index, a sub-dimension of the Environmental Performance Index. In addition, seven models were constructed to assess in detail the impact of economic growth on different dimensions of the ecosystem. The results show that economic growth has a significant impact in all models analyzed. However, the direction of this impact differs across ecosystem components. Economic growth is found to have a positive impact on agriculture and water resources. In these models, a 1% increase in GDP increases the agriculture and water resources indices by 0.074-0.672%. In contrast, economic growth has a negative impact on biodiversity and habitat, ecosystem services, fisheries, acid rain and total ecosystem vitality. In these models, a 1% increase in GDP reduces the indices of biodiversity and habitat, ecosystem services, fisheries, acid rain and total ecosystem vitality by 0.101-2.144%. The results suggest that the environmental costs of economic growth processes need to be considered. Environmentally friendly policies should be combined with sustainable development strategies to reduce the negative impacts of economic growth.