ENVIRONMENTAL KUZNETS CURVE: THE CASE OF ARCTIC RUSSIAN REGIONS

The issue of preserving and protecting the natural environment of the Arctic in the face of increasing industrial activity was presented as very up-to-date. This study explores the long-run interdependence among environment and economic growth in the Arctic regions of Russia. The modern theoretical justification of the existence of environmental Kuznets curve (EKC) is deeply reviewed. Based on panel data for the period of 20002013, the constructed model is used to investigate the existence of environmental Kuznets curve. Various panel data unit root and co-integration tests are also applied. Emissions of harmful pollutants in the air and gross regional product (GRP) series per capita are integrated of order one and co-integrated. We examine the stationary properties of individual series in panel datasets using different panel unit root tests. The long-run relationship using FM-OLS and DOLS panel long-run estimates proposed by Pedroni is developed. According to the concept of the Kuznets curve all regions of the Arctic zone of the Russian Federation are on the increasing branch of the curve. The economic growth is found to have no beneficial effect on the environment in the Arctic. We actualize the problem of preservation and protection of the Arctic environment under conditions of the increasing industrial activity in the focus of modern regional and global climate changes.