Unemployment vs. Environment: The Dilemma in Turkey's Economic Policy

What is it about?

This text discusses a study on the Environmental Phillips Curve (EPC) in Turkey, examining the relationship between unemployment and environmental quality. The research uses the load capacity factor to measure environmental quality and analyzes the effects of GDP, unemployment rate, natural resource rents, and primary energy consumption on the environment from 1982-2022. The study confirms the validity of the EPC, showing that unemployment promotes environmental quality while GDP, natural resource rents, and energy consumption degrade it. The findings highlight a dilemma between employment and environmental policies, suggesting that governments should focus on environmentally friendly production methods, such as renewable energy, to address both issues simultaneously. The study contributes to the existing literature by providing new evidence from Turkey and using the load capacity factor perspective, while also discussing the broader context of global environmental concerns and sustainable development goals.

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Photo by Alex Kotliarskyi on Unsplash

Photo by Alex Kotliarskyi on Unsplash

Why is it important?

This research is significant because it examines the Environmental Phillips Curve (EPC) in Turkey, exploring the relationship between unemployment and environmental quality. Understanding this relationship is crucial for policymakers as they face the challenge of balancing economic growth and employment with environmental sustainability. The study's findings contribute to the growing body of literature on environmental economics and provide valuable insights for developing effective policies that address both unemployment and environmental degradation simultaneously. Key Takeaways: 1. EPC Validation: The study confirms the validity of the Environmental Phillips Curve in Turkey, demonstrating that unemployment promotes environmental quality, which presents a dilemma for policymakers trying to address both issues. 2. Environmental Factors: The research identifies gross domestic product, natural resource rents, and primary energy consumption as factors that accelerate environmental degradation, highlighting the need for sustainable economic practices. 3. Policy Implications: The findings suggest that efforts should be directed towards environmentally friendly forms of production, such as renewable energy sources, which can potentially stimulate employment while improving environmental quality.