State Policy Responses to Urban Development and CO2 Emissions in Kazakhstan: The Role of Global Uncertainty in Shaping Environmental Governance

Abstract

This paper examines the dynamic link between urbanisation and carbon dioxide (CO2) emissions in Kazakhstan with the focus on the impact of global uncertainty. Using annual data from 1990 to 2020, the study uses an autoregressive distributed lag (ARDL) model in error correction form, based on the Environmental Kuznets Curve (EKC) hypothesis. The findings of the paper show that GDP per capita is the main factor influencing both short- and long-term CO2 emissions. Urbanisation dramatically lowers emissions over time, defying popular belief and indicating efficiency improvements in Kazakhstan’s cities. Crucially, the insignificance of the WUI and its interaction term indicates that global uncertainty neither directly affects emissions nor modifies the urbanization - emissions link, contradicting the findings of other authors. These findings have significant policy ramifications: Kazakhstan needs to increase the use of renewable energy sources, diversify its energy sources, and design its cities wisely to divorce growth from emissions. When properly controlled, urbanisation can be a tool for sustainable growth. The analysis concludes that global uncertainty has no discernible impact on Kazakhstan’s emissions trajectory and that domestic structural reforms have a greater impact on emissions reduction than external shocks.