Investigating the validity of the agricultural-induced environmental Kuznets curve (EKC) hypothesis for Ghana: evidence from an autoregressive distributed lag (ARDL) approach with a structural break

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Gideon Ntim-Amo ◽  
Yin Qi ◽  
Ernest Ankrah-Kwarko ◽  
Martinson Ankrah Twumasi ◽  
Stephen Ansah ◽  
...  
Keyword(s):  
Energy Consumption ◽  
Least Squares ◽  
Structural Break ◽  
Value Added ◽  
Ordinary Least Squares ◽  
Kuznets Curve ◽  
Ekc Hypothesis ◽  
Causality Test ◽  
Content Type ◽  
Ardl Approach

PurposeThe purpose of this research is to examine the validity of the agriculture-induced environmental Kuznets curve (EKC) hypothesis with evidence from an autoregressive distributed lag (ARDL) approach with a structural break including real income and energy consumption in the model for Ghana over the period 1980–2014.Design/methodology/approachThe ARDL approach with a structural break was used to analyze the agriculture-induced EKC model which has not been studied in Ghana. The dynamic ordinary least squares (DOLS), canonical cointegration regression (CCR) and fully modified ordinary least squares (FMOLS) econometric methods were further used to validate the robustness of the estimates, and the direction of the relationship between the study variables was also clarified using the Toda–Yamamoto Granger causality test.FindingsThe ARDL results revealed that GDP, energy consumption and agricultural value added have significant positive effects on CO2 emissions, while GDP2 reduces CO2 emissions. The Toda-Yamamoto causality test results show a bidirectional causality running from GDP and energy consumption to CO2 emissions whereas a unidirectional long-term causality runs from GDP2 and agriculture value-added to CO2 emissions.Practical implicationsThis finding validated the presence of the agriculture-induced EKC hypothesis in Ghana in both the short run and long run, and the important role of agriculture and energy consumption in economic growth was confirmed by the respective bidirectional and unidirectional causal relationships between the two variables and GDP. Thus, a reduction in unsustainable agricultural practices is recommended through specific policies to strengthen institutional quality in Ghana for a paradigm shift from rudimentary technology to modern sustainable agrarian technologies.Originality/valueThis study is novel in the EKC literature in Ghana, as no study has yet been done on agriculture-induced EKC in Ghana, and the other EKC studies also failed to account for structural breaks which have been done by this study. This study further includes a causality analysis to examine the direction of the relationship which the few EKC studies in Ghana failed to address. Finally, dynamic ordinary least squares (DOLS), canonical cointegration regression (CCR) and fully modified ordinary least squares (FMOLS) methods are used for robustness check, unlike other studies with single methodologies.

scholarly journals Analysis of the New Kuznets Relationship: Considering Emissions of Carbon, Methanol, and Nitrous Oxide Greenhouse Gases—Evidence from EU Countries

2021 ◽  
Vol 18 (6) ◽  
pp. 2907
Author(s):  
Mara Madaleno ◽  
Victor Moutinho
Keyword(s):  
Nitrous Oxide ◽  
Least Squares ◽  
Fixed Effects ◽  
Ghg Emissions ◽  
Ordinary Least Squares ◽  
Kuznets Curve ◽  
Ekc Hypothesis ◽  
Long Run ◽  
Short Run ◽  
The Eu

Decreased greenhouse gas emissions (GHG) are urgently needed in view of global health threat represented by climate change. The goal of this paper is to test the validity of the Environmental Kuznets Curve (EKC) hypothesis, considering less common measures of environmental burden. For that, four different estimations are done, one considering total GHG emissions, and three more taking into account, individually, the three main GHG gases—carbon dioxide (CO2), nitrous oxide (N2O), and methane gas (CH4)—considering the oldest and most recent economies adhering to the EU27 (the EU 15 (Old Europe) and the EU 12 (New Europe)) separately. Using panel dynamic fixed effects (DFE), dynamic ordinary least squares (DOLS), and fully modified ordinary least squares (FMOLS) techniques, we validate the existence of a U-shaped relationship for all emission proxies considered, and groups of countries in the short-run. Some evidence of this effect also exists in the long-run. However, we were only able to validate the EKC hypothesis for the short-run in EU 12 under DOLS and the short and long-run using FMOLS. Confirmed is the fact that results are sensitive to models and measures adopted. Externalization of problems globally takes a longer period for national policies to correct, turning global measures harder and local environmental proxies more suitable to deeply explore the EKC hypothesis.

The relationship between foreign aid and corruption: a case of selected Asian countries

2019 ◽  
Vol 26 (3) ◽  
pp. 692-704
Author(s):  
Muhammad Ali ◽  
Lubna Khan ◽  
Amna Sohail ◽  
Chin Hong Puah
Keyword(s):  
Least Squares ◽  
Foreign Aid ◽  
Negative Impact ◽  
Panel Cointegration ◽  
Ordinary Least Squares ◽  
Foreign Assistance ◽  
Asian Countries ◽  
Causality Test ◽  
Content Type ◽  
Long Run

Purpose The purpose of this study is to examine the effect of foreign aid (FA) on corruption in selected Asian countries (Pakistan, India, Srilanka and Bangladesh) using the panel data from 2000 to 2014. Design/methodology/approach The author used Levin-Lin-Chu and Im-Pesaran-Shin panel unit root tests to check the stationary properties of the variables. The Pedroni’s and Kao panel cointegration approach was applied to analyze the variable’s long-run relationship. The author used panel dynamic ordinary least squares (PDOLS) and fully modified ordinary least squares (FMOLS) framework to estimate the coefficients of cointegrating vectors. Additionally, the panel granger causality test was performed to check the causal relationship between the variables. Findings The results from PDOLS and FMOLS indicate that FA has a significant negative impact on the level of corruption. This infers that the foreign assistance decrease the level of corruption perception index, hence, more corruption in the country. Originality/value Overall, the study fulfills the need to understand the aid-corruption nexus, particularly in the case of the Asian region.

Financial development, FDI and economic growth: evidence from Sudan

2018 ◽  
Vol 45 (8) ◽  
pp. 1236-1249 ◽  
Author(s):  
Abdalla Sirag ◽  
Samira SidAhmed ◽  
Hamisu Sadi Ali
Keyword(s):  
Economic Growth ◽  
Least Squares ◽  
Financial Development ◽  
Unit Root ◽  
Structural Break ◽  
Ordinary Least Squares ◽  
Series Data ◽  
Content Type ◽  
Long Run ◽  
Cointegration Tests

Purpose The effect of foreign direct investment (FDI) on economic growth is widely believed to be contingent on the development of the financial sector. Nevertheless, as the possibility that the effect of financial development on growth being contingent on FDI has been neglected in existing literature, the authors have investigated it in this paper. In general, the purpose of this paper is to examine the effect of financial development and FDI on economic growth in Sudan using annual data from 1970 to 2014. Design/methodology/approach Since most of the macroeconomic variables are subject to unit root problem, the time series data are assessed using unit root and cointegration tests with/without structural break. Moreover, the study uses the fully modified ordinary least squares and the dynamic ordinary least squares techniques to estimate the long-run model. Findings The results of the cointegration tests provide evidence that a long-run relationship exists among variables even after accounting for the structural break. The results show that financial development and FDI are positive and significant in explaining economic growth in Sudan. Financial development is found to be more beneficial to economic growth than FDI. Moreover, the findings reveal that FDI leads to better economic performance through financial development. Interestingly, the findings of the study show that the effect of financial development on economic growth is further enhanced by the inflows of FDI. Research limitations/implications The government should focus on promoting FDI in more productive sectors. In addition, further cooperation with multinational enterprises is needed to increase FDI in the country. Originality/value This is the first paper that empirically examines both the interlinked impact of FDI on growth through financial development and the impact of financial development on economic growth through FDI in Sudan using appropriate econometric methods.

scholarly journals Fresh Validation of the Low Carbon Development Hypothesis under the EKC Scheme in Portugal, Italy, Greece and Spain

Energies ◽  
2021 ◽  
Vol 14 (1) ◽  
pp. 250
Author(s):  
Daniel Balsalobre-Lorente ◽  
Nuno Carlos Leitão ◽  
Festus Victor Bekun
Keyword(s):  
Renewable Energy ◽  
Energy Consumption ◽  
Least Squares ◽  
Environmental Kuznets Curve ◽  
Ordinary Least Squares ◽  
Cointegration Test ◽  
Kuznets Curve ◽  
Global Issues ◽  
Income Per Capita ◽  
Per Capita

The present study is in line with the United Nations Sustainable Development Goals (UN-SDGs) that address pertinent global issues. This study focuses on the need for access to clean and affordable energy consumption, responsible energy consumption, sustainable economic growth, and climate change mitigation. To this end, this paper evaluates the relevance of the renewable energy sector on the environmental Kuznets curve (EKC) framework in Portugal, Italy, Greece, and Spain for the period 1995–2015. As an econometric strategy, we adopt the use of panel data over the highlighted countries. In the first step, we apply the unit root test recommended by Levin, Lin, and Chu in conjunction with ADF-Fisher, and Phillips-Perron for robustness and consistency. We found that the variables used in this study are integrated I (1) in the first difference. In the second step, we apply the Pedroni cointegration test, and Kao Residual cointegration test, and we observe that the variables are cointegrated in the long run. The generalized least squares (GLS), the panel fully modified least squares (FMOLS), ordinary least squares robust (OLS), and panel quantile regression are considered in this research. The econometric results validate the assumption of the environmental Kuznets curve, i.e., and there is a positive correlation between income per capita and a negative effect of squared income per capita on carbon dioxide emissions. In contrast, we observe that renewable energy reduces CO2 emissions. Finally, we also find a direct connection between the urban population and the environmental degradation in the examined blocs. These results show that in Portugal, Italy, Greece, and Spain, more is required to achieve environmental sustainability in the respective countries growth trajectory. Further policy prescriptions are appended in the concluding section of this study.

scholarly journals Investigating the Dynamic Impact of FDI Inflows and Economic Growth on Environmental Degradation: Evidence From FMOLS and DOLS for Selected Asian Countries

2021 ◽  
Vol 16 (3) ◽  
pp. 183-202
Author(s):  
Hamad Hasul Khan ◽  
◽  
Siti Rahyla Rahmat ◽  
Keyword(s):  
Economic Growth ◽  
Energy Consumption ◽  
Least Squares ◽  
Environmental Degradation ◽  
Ordinary Least Squares ◽  
Kuznets Curve ◽  
Asian Countries ◽  
Fdi Inflows ◽  
Long Run

The study examines the dynamic relationship between foreign direct investment (FDI) inflows, economic growth, and environmental degradation and investigates the long-run validity of the environmental Kuznets curve (EKC) and the pollution haven hypothesis (PHH) for selected Asian countries over the period 1990–2019. Additionally, this study aims to discover the longrun impact of energy consumption, globalization, and population density on environmental degradation by employing a panel cointegration approach, fully modified ordinary least squares (FMOLS), and dynamic ordinary least squares (DOLS). The findings provide clear evidence of the existence of EKC and PHH in Asian countries for the period 1990–2019 in the long run. The findings reveal that economic growth has a highly significant and positive role in depleting environmental quality, but this effect gets reversed in the long run as, after a certain turning point, economic growth increases, and the quality of the environment gets better. Moreover, FDI inflows and energy consumption have a positive long-run impact on CO2 emissions, thus contributing to environmental degradation. The study recommends that governments and policymakers should strategically devise and implement CO2 reduction policies, such as carbon pricing, to encourage economic growth and to improve the quality of the environment, with the ultimate goal being to achieve sustainable development. Moreover, the use of cleaner energy should be promoted, and innovations and technological developments should be encouraged for hydropower, wind power, solar energy and other facilities around the world.

scholarly journals Is there an environmental Kuznets inverted-U shaped curve?

2018 ◽  
Vol 65 (1) ◽  
pp. 79-94 ◽  
Author(s):  
Cüneyt Kiliç ◽  
Feyza Balan
Keyword(s):  
Energy Consumption ◽  
Co2 Emissions ◽  
Financial Development ◽  
Trade Openness ◽  
Institutional Quality ◽  
Ordinary Least Squares ◽  
Kuznets Curve ◽  
Ekc Hypothesis ◽  
Cubic Polynomial ◽  
Carbon Dioxide Co2

This study examines the relationship among carbon dioxide (CO2) emissions, income, energy consumption, trade openness, financial development and institutional quality based on the environmental Kuznets curve (EKC) hypothesis in 151 countries for the period 1996-2010, using the pooled ordinary least squares methods. The results support cubic specification of the EKC hypothesis, which assumes a cubic polynomial inverted-U shaped relationship between income and environmental degradation. Other empirical results indicate that energy consumption, trade openness, financial development and institutional quality are significant variables in explaining CO2 emissions.

scholarly journals The Role of Energy Consumption, Economic Growth and Globalization in Environmental Degradation: Empirical Evidence from the BRICS Region

2021 ◽  
Vol 13 (4) ◽  
pp. 1924
Author(s):  
Habib Ur Rahman ◽  
Umer Zaman ◽  
Jarosław Górecki
Keyword(s):  
Economic Growth ◽  
Energy Consumption ◽  
Least Squares ◽  
Environmental Degradation ◽  
Carbon Emission ◽  
Panel Cointegration ◽  
Ordinary Least Squares ◽  
Kuznets Curve ◽  
Annual Data ◽  
Long Run

This paper examines the effect of energy consumption, globalization, and economic growth on the CO2 emission of the BRICS (Brazil, Russian Federation, India, China and South Africa) region. Using annual data from 1989 to 2019, this research applies a panel cointegration approach. In this framework, we use Fully Modified Ordinary Least Squares (FMOLS) and Dynamic Ordinary Least Squares (DOLS) methods to examine the long-run relationship between the selected variables. This empirical investigation reveals that there is a long-run association between these variables, and energy consumption positively and significantly affects the carbon emission in these countries. These results indicate that energy consumption is the primary source of environmental degradation in the region. In contrast, the globalization (KOF Index of Globalization) negatively and significantly affects the carbon emission, implying the improvement of environmental quality. Further, this research could not find the presence of environmental Kuznets curve in the region. Policy guidelines are suggested in the line of findings.

Does human capital matter for reduction in energy consumption in India?

2019 ◽  
Vol 13 (2) ◽  
pp. 359-376 ◽  
Author(s):  
Vaseem Akram ◽  
Bhushan Praveen Jangam ◽  
Badri Narayan Rath
Keyword(s):  
Human Capital ◽  
Energy Consumption ◽  
Energy Conservation ◽  
Least Squares ◽  
Negative Relationship ◽  
Ordinary Least Squares ◽  
Annual Data ◽  
Content Type ◽  
Long Run ◽  
Short Run

Purpose This paper aims to investigate whether improvement in human capital can foster energy conservation by reducing the energy consumption in India using annual data from 1980 to 2014. Further, this study examines the relationship between human capital and various forms of energy consumption such as electricity, coal, natural gas, hydrocarbon gas and petroleum consumption. Design/methodology/approach To attain the objective, the study investigates this relation through the auto-regressive distributed lag model (ARDL) technique to find a long-run and short-run relationship. Second, to check the robustness of the results, the authors use alternative econometric methods such as dynamic ordinary least squares and fully modified dynamic ordinary least squares. Findings The results reveal a negative relationship between human capital and energy consumption, which implies that improvement in human capital lowers the energy consumption and various forms energy consumption, except for petroleum consumption. The results derived from ARDL show that there exists a long-run and short-run association between human capital and energy consumption. The results are consistent across the econometric techniques. Practical implications Because G20 countries including India aim at reducing carbon emission to a certain level, this study provides an insight that by emphasizing on human capital, India can reduce energy consumption, which would foster energy conservation. Originality/value To the best of the authors’ knowledge, this the first study in India which attempts to examine the effect of human capital on energy consumption and its various forms.

scholarly journals Trade, Energy Consumption, Economic Growth and Ecological Quality: An Empirical Evidence from D-8 and G-7 Countries

2021 ◽  
Author(s):  
Muhammad Tariq Majeed ◽  
Naveed Asghar
Keyword(s):  
Least Squares ◽  
Carbon Dioxide Emissions ◽  
Ordinary Least Squares ◽  
Sustainable Growth ◽  
Kuznets Curve ◽  
Ecological Quality ◽  
Causality Test ◽  
Sustainable Environment ◽  
Cointegration Tests ◽  
Augmented Dickey Fuller

Abstract While pursuing sustainable growth there is a need to inculcate the procedure of a sustainable environment for coming generations. This study investigates the association between carbon dioxide emissions (CO2) and gross domestic product (GDP), disaggregate and aggregate energy usage, trade, using yearly data for the time component of 1980–2019 for D-8 and G-7 countries. The study employs second-generation unit root tests namely cross sectionally augmented Dickey Fuller (CADF) and cross sectionally augmented IPS (CIPS). Further, Kao, Pedroni, and Westerlund cointegration tests are employed to test for cointegration. To estimate models, fully modified least squares (FMOLS), dynamic ordinary least squares (DOLS) and heterogeneous panel estimators (MG, AMG, CCEMG, DCCEMG) are used. Finally, to verify the causality among the study variables the Dumitrescu and Hurlin, (2012) causality test is used. The findings of the study reveal that income, aggregate, and disaggregate energy consumptions (oil, coal, gas), and trade exacerbate ecological quality in D-8 countries while income and trade improve it in G-7 economies. However, oil, coal, and gas usage are detrimental for ecological quality in G-7 economies. The study validates an inverted U-shaped environmental Kuznets curve in D-8 while U-shaped in G-7 countries. It is recommended that both groups of countries need to adopt green strategies and sustainable patterns for growth and development.

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