Dynamic linkages among corruption, economic liberty, the underground economy and carbon release in BRICS nations

Abstract

Acknowledging the urgent need to address these issues, the United Nations has included numerous environmental goals among its 17 “Sustainable Development Goals.” Environmental justice is one of the justice concepts covered by SDG 16. This background motivated the study to investigate the dynamic interactions among corruption, economic liberty, the underground economy, and CO 2 emissions between 1995 and 2020, in light of the BRICS nations' economic expansion and energy intensity. To support the panel data, second-generation panel techniques, that is, cointegration, long-run elasticity estimates, and causality, are used. The empirical results indicate a long-run association among the variables. Corruption significantly enhances environmental degradation. Conversely, underground economic activity has positive environmental outcomes in the long run. The paper concludes with significant policy implications for BRICS nations, highlighting their shortcomings and suggesting areas for further research.