The Relationship between Foreign Investment, Human Development, and Economic Growth with Carbon Dioxide Emissions in Yemen: Does Political Instability Affect This Relationship?

Abstract

The issue of global warming and climate change is among the critical concerns that threaten life on earth, attracting the interest of governments, international organizations, and humanity in identifying its causes and developing solutions. According to prior studies, increasing foreign investments, human development, and economic growth are the main factors exacerbating carbon emissions; however, their effects may not be notable in Yemen. Thus, this study aims to explore the interrelation between foreign investments, human development, economic growth, and carbon emissions, and how this relationship is affected by political instability in Yemen. Using a time-series approach with data spanning 1990 to 2019, this study finds that human development and economic growth are positively and significantly associated with carbon emissions, whereas foreign investments show an insignificant association. The results also indicate that the current political instability in Yemen (the ongoing civil war) does not have a direct effect on carbon emissions, although it weakens the relationships between human development, economic growth, and carbon emissions. This study is among the limited research exploring factors associated with carbon emissions in Yemen and examining the moderating effect of political instability. Consequently, it offers important theoretical and practical implications for various decision-makers.