Abstract:

Developments such as the deepening of the globalization process, the increase in industrialization and urbanization, technological advances and population growth cause various effects on the environment. With the occurrence of environmental degradation and becoming a threat to the country's economies, it has become important to solve the problem in question. The determination of the measures to be taken to increase the environmental quality and the determinants of environmental degradation have been frequently discussed recently. This study examines the relationship between financial development, economic globalisation, energy consumption, economic growth and environmental degradation in the Turkish economy. The ARDL bounds test was used as an empirical method in the study, in which annual data from the 1980-2018 sampling period were used. According to the short-run results of the ARDL bounds test, increases in economic globalisation, energy consumption and economic growth increase environmental degradation. In the long run, increases in economic globalisation and economic growth are found to increase environmental degradation, while increases in financial development are found to decrease environmental degradation. These results revealed the importance of renewable energy use and green growth to reduce environmental degradation. On the other hand, it is concluded that environmental quality can be improved by ensuring financial deepening.

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