Agriculture, forestry, and environmental sustainability: the role of institutions.

Agriculture and forestry are two primary determinants of the environment, and strong institutions are crucial to moderate the outcomes of these sectors toward a sustainable environment. Therefore, this study aimed to examine the impact of agriculture and forestry on carbon emissions in light of institutional quality. Data at global and five regional levels from 1996 to 2015 were assessed using econometrics tools, namely cross-sectional tests, panel unit root tests, cointegration tests, Driscoll & Kraay, and fully modified ordinary least square regressions and causality analyses. The analysis indicates that agricultural production has a positive effect on CO₂ emissions, whereas forestry has a negative impact. The direct and moderating effects of institutional quality on the CO₂ emissions are positive. These results emphasize the importance of institutional excellence in the reduction in agricultural and forestry emissions. The study reveals that renewable energy consumption is crucial in improving environmental quality, whereas non-renewable energy consumption is not. Causality analysis reveals bidirectional causality between CO₂ emissions and agriculture, forestry, and renewable energy. The study implies that countries should encourage renewable energy and the adoption of environment-friendly practices in agriculture. An increase in forest areas is also important for a clean environment. Nevertheless, the role of institutions for a sustainable environment cannot be underestimated. [ABSTRACT FROM AUTHOR]