Integrated Paradigm for Sustainable Development: A Panel Data Study

Abstract The concept of sustainable development requires countries all over the world to use their natural resources rationally while pursuing their economic development, and at the same time to consider the quality of environment as a determinant of their societies’ welfare. First, the method of principle component analysis and composite indicators are adopted to construct an overall sustainable development index and resource intensity measure using Millennium Development Goals (MDG) and World Development Indicator Data. Second, this paper applies an integrated paradigm to investigate the relationship between natural resource availability, economic growth, and the environment using a panel of 62 countries over the period 1990-2007. This interlocking relationship is analyzed through estimating the Resource Curse Hypothesis model and the Environmental Kuznets Curve model simultaneously while taking into consideration an important dimension—namely institutional quality. The results suggest that the way countries are dealing with sustainability in the context of MDG is negatively affecting the quality of the environment. Moreover, it proposes that countries with good institution quality are not taking the environmental problems seriously. Arabic Abstract: