A Study on the Causality relationship among Economic Sanctions, Macroeconomic Variables and Environmental Polluters in Iran

Research on environment is a very important task for the process of sustainable development. Although economic growth is one of the most important aims of many governments, rapid economic growth normally suffers environment severely. Thus there is a potential contrast between economic policies and environmental situation. Moreover, the sanctions affect environment issues due to institutional and technical reasons. Thus, in this paper the causality among Economic sanctions, Macroeconomic factors and environmental polluters has been examined using Hsiao causality approach. To do this, the CO2, CH4, and NOx gases as the main polluters variables and value-added of industry, mine, oil sectors and non-oil GDP as the main macroeconomic variables have been used. The results show that there is a significant unidirectional causality from economic sanctions to macroeconomic variables. Moreover, there is a unidirectional causality from economic sanctions to polluter gases. Thus, removing economic sanctions can result in decreasing environmental pollution, on the one hand, and increasing GDP, on the other, in Iran.