Is Democracy Environmentally Friendly? An Empirical Investigation into How Institutional Quality affects Environmental Deterioration in Indonesia

Authors

  • Herman Cahyo Diartho Faculty of Economics and Business, University of Jember, Indonesia.
  • M. Iqbal Fardian Economica Institute, Indonesia.

DOI:

https://doi.org/10.22452/JIE.vol18no3.4

Keywords:

Institutional quality, Democracy, Environmental degradation, STIRPAT, ARDL

Abstract

This study investigates the impact of democracy on environmental degradation
in Indonesia using the autoregressive distributed lag (ARDL) model over the period of
1971 to 2018. The analysis employs the STIRPAT framework to assess how institutional
quality, energy structure, and other factors affect carbon dioxide emissions. The results
show that institutional quality has a significant effect on environmental degradation
in the short term, but becomes statistically insignificant in the long term. Meanwhile,
energy structure—measured by the share of fossil fuels in total energy consumption—
positively and significantly affects environmental degradation in both time horizons.
These findings highlight the critical role of transitioning to renewable energy and
improving governance quality. Although democracy has the potential to foster better
environmental outcomes through transparency and citizen participation, the study
reveals that in Indonesia, democratic institutions may also enable environmentally
harmful practices due to weak enforcement and short-term political incentives. Therefore,
effective environmental governance requires not only democratic mechanisms but
also strong, transparent institutions. Policy recommendations include strengthening
institutional accountability, increasing public access to environmental information, and
promoting energy diversification to ensure sustainable development.

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Published

2026-07-01

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Section

Articles