This study explores the dynamic relationship between polluting emissions and economic cycle shocks in developing countries using a panel vector autoregressive (PVAR) framework. Recognizing the limitations of prior models that focused primarily on causality between emissions and economic variables without forecasting capabilities, this research incorporates a PVAR methodology aligned with innovative local gray forecast models to generate dynamic forecasts and conduct structural analyses. Employing the PVAR model, impulse–response functions (IRFs) were analyzed to assess the impacts of economic shocks on pollution levels and the challenges these pose to both renewable and non-renewable energy sources. The analysis further involved the decomposition of variance among the variables. Key findings reveal that economic growth in these countries often correlates with increased use of carbon dioxide-emitting energies. However, the substitution of these energies with renewable sources is not only feasible but also pivotal for promoting environmental purification and sanitation through enhanced investments in renewable energies. Despite the theoretical potential for growth in the renewable sector, its actual development in these countries remains inadequate, and its contribution to fostering an ecological environment that supports economic growth is minimal. The study underscores the necessity of robust policies to facilitate ecological growth and the imperative of a shared commitment among nations to ensure the effectiveness of these policies.
This investigation delineates the critical role of the Blue Economy in preserving the planet's natural capital, a cornerstone for sustainable development. A systematic analysis of theoretical research and policy documents was conducted to elucidate the integration of economic systems with environmental conservation. Correlation and regression analyses were employed to evaluate the interactions between economic activities and the status of natural capital, with particular emphasis on Gross Domestic Product (GDP), population growth, ecological footprints, and biocapacity over the period from 1994 to 2020. The results revealed that prevalent economic practices are contributing to significant depletion of natural capital, thereby posing severe risks to both ecological and economic stability. Moreover, the efficacy of the Blue Economy in mitigating these risks was demonstrated, showcasing its potential to align economic growth with environmental preservation. This study provides compelling evidence that a transition towards the Blue Economy is not merely viable but imperative for sustainable development. The implications of these findings are pivotal for policymakers, stakeholders, and industries, underscoring the urgent need to revise economic strategies to prioritize environmental sustainability. Such a shift is deemed crucial for realizing long-term sustainability goals and ensuring economic resilience in the face of environmental challenges.