Ekonomska Istraživanja (Dec 2021)

How public expenditure in recreational and cultural industry and socioeconomic status caused environmental sustainability in OECD countries?

  • Lu Shao,
  • Hao Zhang,
  • Muhammad Irfan

Journal volume & issue
Vol. 0, no. 0
pp. 1 – 18


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Progression towards environmental sustainability is mainly studied from the consumption or users’ perspective and urges the government to create social and cultural responsiveness towards ecological suitability. Also, it is pertinent that the level of compliance towards environmental regulations is highly dependent on the quality of socioeconomic status of the public and government interventions in terms of annual budgetary allocations in the respective industry or sector. Therefore, the study explores the government's participation through public expenditure in the entertainment and cultural sector and socioeconomic factors in realizing environmental sustainability in OECD countries. The data set consists of observations from 1990 to 2019 on which the advanced panel technique, namely; Cross Section ARDL was applied. The results reported that both the government budgetary allocations in entertainment and cultural industry and socioeconomic status are crucial for ensuring environmental sustainability as they assist in decreasing the level of carbon emissions. Manifestly, the magnitude of the interaction term empirically proves that when both government allocations and socioeconomic factors are integrated, the emissions mitigating effects turn more pronounced. These results imply that the appropriate budgetary allocations in entertainment and cultural industry promotes environmental performance channelized through people’s welfare, awareness, and satisfaction. Along with fiscal allocations, socioeconomic factors are imperative to maximize positive spillovers for ecological sustainability.