The Cost of Growth: How OPEC Countries Navigate the Trade-Offs of Sustainable Development?

Abstract

OPEC member countries face a persistent challenge in balancing economic growth with environmental sustainability and public health. This study investigates the interlinked dynamics among economic growth, environmental protection, and public health using a panel dataset from 1990 to 2024 and employing robust econometric methods, including stationarity tests, fixed effects estimation, and the Hausman test. Key variables analyzed include per capita GDP, capital accumulation, urbanization, education, CO? emissions, and adult mortality rates. The results demonstrate that while capital accumulation and urbanization significantly enhance economic growth, they do not inherently alleviate environmental pressures. The empirical rejection of the Environmental Kuznets Curve (EKC) suggests that rising income levels in OPEC countries are associated with continued environmental degradation. Public health, conversely, was found to positively influence economic growth, highlighting its role as both an outcome and a driver of development. Education emerged as a supportive factor, improving health outcomes and correlating positively with economic growth, although its environmental impact was statistically insignificant. Drawing upon these empirical results, the present study delineates focused strategies for policymaking, including increased investment in human capital, reallocation of oil revenues toward healthcare and environmental remediation, and a gradual transition toward cleaner industrial practices. These proposals aim to help OPEC countries address the negative trade-offs between industrial expansion, environmental degradation, and public health challenges on the path to sustainable development.

Keywords: Sustainable Development, Economic Growth, Environmental Protection, Public Health, Kuznets Curve hypothesis, OPEC Member Countries