Country's Environmental Performance: Does National Culture and Religiosity matter?

The study of a country’s environmental sustainability is an important topic because it allows an understanding of the causes and possible solutions for protecting the environment, human health, and natural resources. Among the drivers of sustainable development, there is also the national culture of the countries, which can play a significant role in the implementation of policies aimed at environmental sustainability and which has been the subject of several scientific studies. This paper is aimed at studying how national culture impacts a country’s sustainability performance, starting from Hofstede’s cultural dimensions (power distance, individualism, masculinity, uncertainty avoidance, long-term orientation, indulgence). Unlike previous scientific literature, this work considers religiosity as one of the cultural variables that can impact a country’s environmental performance. In particular, the two most widespread religions worldwide, Christianity and Islam, were taken into consideration. To evaluate the environmental performance of countries, we utilized the Environmental Performance Index (EPI), since it provides a data-based overview of the status of sustainability worldwide, using performance indicators related to climate change, environmental health, and ecosystem vitality. Additionally, our analysis incorporated socio-economic variables as normalizing factors, including gross domestic product per capita, employment rate, and educational level. Our research investigates 96 countries across the globe, with 1,056 country-year observations taken into consideration for the period between 2011 and 2021. The study employs a dynamic panel data model that involves a two-step system-GMM. Our results suggest a strong relationship between cultural dimension and EPI.