Vol.:(0123456789) 1 3 Air Quality, Atmosphere & Health https://doi.org/10.1007/s11869-023-01344-x Observing the response of environmental and economic performances to tourism in light of structural changes Muhammad Wasim Akram 1,2  · Shuchun Yang 3  · Muhammad Hafeez 4 Received: 24 November 2022 / Accepted: 15 March 2023 © The Author(s), under exclusive licence to Springer Nature B.V. 2023 Abstract In the current study, we explored the asymmetric impact of structural changes and tourism activities on economic perfor- mance and carbon emissions in selected economies of the Asian region from 1995 to 2020. Our findings say that the long-run estimates of positive shock in tourism are positively significant in China and India. Conversely, the estimated coefficient of negative shock in tourism is positive and significant in India only. These results confer that a rise in tourism activities causes economic growth to rise in China and India, whereas a fall in tourism activities causes economic activities to fall in India only. Similarly, a long-run positive structural change improves the economic growth in Thailand, Malaysia, and India. However, surprisingly, a long-run negative structural change also enhances the economic development of Thailand and Japan. On the other side, a positive shock in the tourism industry causes CO 2 emissions to fall in China, Japan, and Malaysia and rise in India. Likewise, a negative shock in tourist activities reduces in Japan and increases carbon emissions in Malaysia. Moreover, a positive structural change reduces CO 2 emissions in China, Thailand, and Japan, while a negative structural change reduces CO 2 emissions in China and India only. Keywords Tourism productivity · Structural change · Economic growth · CO 2 emissions Introduction Sustainable economic growth and ecological stability are two of the world’s greatest issues in recent times. The rising concentration of carbon emissions in the air has elevated environmental concerns to the forefront of modern problems confronting emerging and established nations (Blunden et al. 2018). The ozone layer’s degradation and the rise in average world temperature are both attributable to this. Numerous human disorders, including stroke, lung cancer, and cardiac and pulmonary conditions, may be traced back to environ- mental deterioration. It is all attributable to a higher death toll, natural capital depletion, and agricultural infrastructure destruction (Ahmad et al. 2020). Human extraction of com- modities and services in the ecosystem is a significant source of anxiety in contemporary society, prompting heightened attention to environmental degradation (Ozturk & Acaravci 2009; Usman et al. 2022). More traditional energy is being used, which poses a major risk to environmental quality. The “EEEs (economy, energy, and environment)” are the three most important factors in determining a nation’s long- term development. In the same way as technical progress, financial sector progress, employment rates, shifts in energy consumption, the growth of the tourist industry, structural change, and the restriction and growth of manufacturing have all impacted the environmental quality, and so too are people. The world is facing the challenge of global warming due to the increase in fossil fuel consumption (Usman et al. 2023). According to the Intergovernmental Panel on Cli- mate Change (IPCC) and climate scientists of the UN, if the global temperature rose to 1.8 °C above the levels of the 1850s, then almost half the population of the world will be exposed to humidity and life-threatening heat. To avoid this, 194 economies of the world signed the Paris Agreement in * Muhammad Hafeez hafeez_86@hotmail.com; Muhammad.Hafeez@uaf.edu.pk 1 Scientia Academia Malaysia, Johor Bahru, Malaysia 2 Department of Business Administration, University of Sialkot, Sialkot, Pakistan 3 Department of Network Security and Information Technology, University of International Business and Economics, Beijing, China 4 Institute of Business Management Sciences, University of Agriculture, Faisalabad, Pakistan