Economic Complexity and The Environmental Performance in Central and Eastern European Countries

İngilizce (OpenAlex)

The pursuit of the European Union’s Green Deal goals emphasizes the growing necessity for member states to align and harmonize their production systems. In this context, analyzing the environmental consequences of the economic frameworks of Central and Eastern European countries, which have been transitioning to a market economy since the 1990s, becomes a critical concern. This study investigated the connection between the economic complexity index (ECI) and the environmental performance of the Central and Eastern European countries that are members of the EU. Thus, the aim of the study is to reveal the effects of CEECs’ production structures on environmental performance. While using the panel data analysis, the 1995–2018 period was taken into consideration. Due to evidence of cross-sectional dependency, the second-generation unit-root test and Westerlund cointegration test was used. Afterwards, causality conditions were tested. Consequently, no cointegration has been found, however it was found that there is a causality from ECI to CO2 emission, also from economic growth to Ecological Footprint (EF) in these countries. On the contrary, there is no causality between ECI and EF.