scholarly journals The rise and fall of the energy-carbon Kuznets curve: evidence from Africa

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Olatunji Shobande ◽  
Simplice Asongu
Keyword(s):  
Carbon Emissions ◽  
Critical Role ◽  
Panel Cointegration ◽  
Kuznets Curve ◽  
Empirical Estimation ◽  
Content Type ◽  
Vector Autoregressive ◽  
Panel Granger Causality ◽  
Panel Cointegration Test ◽  
Causality Tests

PurposeThis paper provides an analysis of the energy-carbon Kuznets curve hypothesis (CKC) using a second-generation panel methodology.Design/methodology/approachSpecifically, the authors investigate whether energy consumption, natural resources and governance explain the CKC proposition. The study’s empirical strategy is based on the Westerlund panel cointegration test, augmented mean group (AMG) and vector autoregressive (VAR) panel Granger-causality tests.FindingsThe results suggest that the CKC hypothesis is incomplete without these mechanisms, as they play a critical role in reducing carbon emissions in Africa. The authors recommend improving the environmental standards and proper regulatory and monitoring systems to reduce carbon emissions and promote sustainable development in the continent.Originality/valueThe study revisits the CKC hypothesis with particular emphasis on governance and more robust empirical estimation techniques.

Deviations from fundamental value and future closed-end country fund returns

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Luis Berggrun ◽  
Emilio Cardona ◽  
Edmundo Lizarzaburu
Keyword(s):  
Control Variable ◽  
Asset Returns ◽  
Weak Form ◽  
Share Price ◽  
Local Market ◽  
Impulse Response Functions ◽  
Content Type ◽  
Vector Autoregressive ◽  
Causality Tests ◽  
Fundamental Value

PurposeThis article examines whether deviations from fundamental value or closed-end country fund's discounts or premiums forecast future share price returns or net asset returns.Design/methodology/approachThe main empirical (econometric) tool is a vector autoregressive (VAR) model. The authors model share price returns and net asset returns as a function of their lagged values, the discounts or premiums, and a control variable for local market returns. The authors also conduct Dickey Fuller and Granger causality tests as well as impulse response functions.FindingsIt was found that deviations from fundamental value do predict share price returns. This predictability is contrary to weak-form market efficiency. Premiums or discounts predict net asset returns but weakly.Originality/valueThe findings point to the idea that the closed-end fund market is somewhat predictable and inefficient (in its weak form) since the market appears to be able to anticipate a fund's future returns using information contained in the premiums (or discounts). In particular, the market has the ability to anticipate future behaviour because growing premiums forecast declining share price returns for one or two periods ahead.

Panel Data Analysis of Financial Development, Trade Openness, and Economic Growth: Evidence from BRICS Countries

2018 ◽  
Vol 4 (1) ◽  
pp. 1-18 ◽  
Author(s):  
Ritu Rani ◽  
Naresh Kumar
Keyword(s):  
Economic Growth ◽  
Trade Openness ◽  
Panel Cointegration ◽  
Least Square ◽  
Cointegration Test ◽  
Ordinary Least Square ◽  
Brics Countries ◽  
Long Run ◽  
Panel Granger Causality ◽  
Panel Cointegration Test

The purpose of this article is to investigate the possible cointegration and direction of causality between foreign direct investment (FDI) inflow, trade openness, and economic growth in BRICS countries using panel data from 1993 to 2015. Besides these variables, money supply and domestic credit (DC) to private players are also added in the model to examine the impact of financial openness on economic growth. The Pedroni’s panel cointegration test is used to examine the existence of long-run relationship, and coefficients of cointegration are examined by fully modified ordinary least square (FMOLS) and dynamic ordinary least square (DOLS). Further panel Granger causality test is used to examine the direction of causality among the competing variables. The results of Pedroni’s panel cointegration test indicate that there exists a long-run relationship among the variables under considerations in BRICS countries. The coefficient of FMOLS and DOLS indicates that trade openness has a positive impact on economic growth in BRICS countries while FDI inflow has a negative impact in these nations. In addition, the results of panel Granger causality confirmed bidirectional causality between FDI inflow and economic growth in the short run. The study recommends that BRICS countries should liberalize trade openness as it strengthens the position of member countries in the world economy.

Investigating energy consumption and economic growth for BRICS-T countries

2019 ◽  
Vol 16 (4) ◽  
pp. 184-195 ◽  
Author(s):  
Durmuş Çağrı Yıldırım ◽  
Seda Yıldırım ◽  
Isıl Demirtas
Keyword(s):  
Economic Growth ◽  
Energy Consumption ◽  
Energy Savings ◽  
Panel Cointegration ◽  
Cointegration Test ◽  
Real Output ◽  
Content Type ◽  
Natural Logarithm ◽  
Panel Cointegration Test ◽  
The Relationship

Purpose The purpose of this paper is to explore the relationship between energy consumption and economic growth for Brazil, Russia, China, India, South Africa and Turkey (BRICS-T) countries. In this context, this study investigates energy consumption and real output in BRICS-T countries through panel cointegration. Design/methodology/approach The data include energy consumption and real output for BRICS-T countries and period of 1990–2014. The variables are transformed into natural logarithm. To analyze these data, this study employed Pedroni cointegration test, the second-generation panel cointegration test, Westerlund and Edgerton (2008) test and FMOLS test. Findings Results indicate that there is a bi-directional causality relationship between energy consumption and economic growth for BRICS-T countries. An increase in GDP leads to an increase in energy consumption and an increase in energy consumption leads to an increase in GDP. Research limitations/implications This study used data that include the period of 1990–2014 for BRICS-T countries. So, further studies can use different periods of data or different countries. Originality/value This study provides important evidence that countries with strong growth performance need to follow bi-directional energy policies to increase both energy investments and ensure energy savings.

The dynamics of banking sector and stock market maturity and the performance of Asian economies

2014 ◽  
Vol 30 (1) ◽  
pp. 16-44 ◽  
Author(s):  
Rudra P. Pradhan ◽  
Mak B. Arvin ◽  
Neville R. Norman ◽  
John H. Hall
Keyword(s):  
Economic Growth ◽  
Stock Market ◽  
Banking Sector ◽  
Panel Cointegration ◽  
Principal Component ◽  
Financial Sector ◽  
Estimation Methods ◽  
Asian Countries ◽  
Content Type ◽  
Causality Tests

Purpose – The purpose of this paper is to examine the nature of causal relations between banking sector maturity, stock market maturity, and four aspects of performance and operation of the economy: economic growth, inflation, openness in trade, and the degree of government involvement in the economy. Design/methodology/approach – The authors look for possible links between the variables by conducting panel cointegration and causality tests, using a large sample of Asian countries over the period 1960-2011. Novel panel data estimation methods allow for robust estimates, using both variation between countries and variation over time. Findings – The study identifies interesting causal links among the variables deriving uniquely from our innovations. In particular, The paper finds that for all regions considered, banking sector maturity and stock market maturity are causally linked, sometimes in both directions. Furthermore, stock market maturity may lead to economic growth, both directly and indirectly through indicators such as inflation and trade openness. The findings also support the notion that economic growth affects the maturity of the stock market in most regions. Practical implications – The results lend support to the notion that a mature financial sector is a key contributor to generating economic growth. Furthermore, economic growth itself has the potential to bring about maturity in the financial sector. Originality/value – The paper uses sophisticated principal-component analysis, panel cointegration, and Granger causality tests, methods not used in this literature before. The method was applied to recent data pertaining to 35 Asian countries – a group of countries that has previously not been adopted in this literature.

scholarly journals Economic Growth, Foreign Direct Investment and the Environment: An Empirical Investigation for SAARC Countries

2016 ◽  
Vol I (I) ◽  
pp. 1-12
Author(s):  
Abida Yousaf ◽  
Naila Erum ◽  
Fozia Bibi
Keyword(s):  
Open Economy ◽  
Carbon Emissions ◽  
Panel Cointegration ◽  
Kuznets Curve ◽  
Per Capita Gdp ◽  
Economy Model ◽  
Long Run ◽  
Short Run ◽  
Per Capita ◽  
Open Economy Models

The study tests the validity of the environmental Kuznets curve (EKC) for SAARC countries by using closed and open economy Models. The Peroni Panel Cointegration technique along with FMOLS estimation techniques have been used for empirical analysis by using the data from 1972-2015. The long run and short run estimates of the closed economy model reveals positive and significant relationship between Per capita GDP, per capita GDP2 and the carbon emissions that deny the existence of EKC. The findings of open economy model signify that FDI not only helps to transfer cleaner technologies, but it enables the producers to use less pollutant technologies for the production purposes. Moreover, an increase in the forest area is helpful for reducing the carbon emissions. Finally, population density and energy consumption are proved significant contributors of carbon emissions. The study suggests that effective policies should be followed for reducing emissions, regulating FDI-environment and per capita GDP environment relationship.

Do agriculture-based economies mitigate CO2 emissions?

2019 ◽  
Vol 14 (3) ◽  
pp. 638-652 ◽  
Author(s):  
Javaid Ahmad Dar ◽  
Mohammad Asif
Keyword(s):  
Renewable Energy ◽  
Energy Consumption ◽  
South Asian ◽  
Carbon Emissions ◽  
Real Income ◽  
Renewable Energy Consumption ◽  
Content Type ◽  
Long Run ◽  
Causality Tests ◽  
Granger Causality Tests

Purpose This study aims to fill the gap in income-environment literature by adding agricultural contribution to the nexus. The authors investigate the short-run and long-run impact of agricultural contribution, renewable energy consumption, real income, trade liberalisation and urbanisation on carbon emissions for a balanced panel of five South Asian Association for Regional Cooperation (SAARC) countries spanning the period 1990-2013. Design/methodology/approach Pedroni and Kao cointegration techniques have been used to test the existence of long-run relationship between the variables. The directions of causal relationships have been verified using Granger causality tests. Further, the long-run parameters of the baseline equation have been estimated by using the fully modified ordinary least squares, the technique developed by Pedroni, (2001a) for heterogeneous cointegrated panels. Findings The result reveals that agricultural contribution and renewable energy consumption improve environmental quality in the long run, while urbanisation and per capita real income degrade it. The study did not find any evidence of “pollution heaven hypothesis” in the selected countries. The Granger causality tests confirm bidirectional causality between carbon emissions and income and between carbon emissions and urbanisation. In addition, there is unidirectional causality running from agricultural contribution to renewable energy consumption. Originality/value This is the only study to investigate the role of agriculture sector in carbon mitigation from a panel of South Asian economies. To the best of the authors’ knowledge, it is also the first study to test the applicability of “pollution heaven hypothesis” for SAARC countries.

Environmental Kuznets curve for CO2 emissions: a literature survey

2019 ◽  
Vol 46 (1) ◽  
pp. 106-168 ◽  
Author(s):  
Muhammad Shahbaz ◽  
Avik Sinha
Keyword(s):  
Environmental Kuznets Curve ◽  
Social Indicators ◽  
Ecological Economics ◽  
Capital Inflows ◽  
Empirical Literature ◽  
Kuznets Curve ◽  
Empirical Estimation ◽  
Data Set ◽  
Content Type ◽  
Foreign Capital Inflows

Purpose The purpose of this paper is to provide a survey of the empirical literature on environmental Kuznets curve (EKC) estimation of carbon dioxide (CO2) emissions over the period of 1991–2017. Design/methodology/approach This survey categorizes the studies on the basis of power of income in empirical models of EKC. It has been hypothesized that the EKC shows an inverted U-shaped association between economic growth and CO2 emissions. Findings For all the contexts, the results of EKC estimation for CO2 emissions are inconclusive in nature. The reasons behind this discrepancy can be attributed to the choice of contexts, time period, explanatory variables, and methodological adaptation. Research limitations/implications The future studies in this context should not only consider new set of variables (e.g. corruption index, social indicators, political scenario, energy research and development expenditures, foreign capital inflows, happiness, population education structure, public investment toward alternate energy exploration, etc.), but also the data set should be refined, so that the EKC estimation issues raised by Stern (2004) can be addressed. Originality/value By far, no study in the literature of ecological economics has focused on the empirical estimation of EKC for CO2 emissions. This particular context has been used for this study, as CO2 is one of the highest studied pollutants in the ecological economics, and especially within the EKC hypothesis framework.

scholarly journals QUALITY OF INSTITUTIONS AND FOREIGN DIRECT INVESTMENT IN DEVELOPING COUNTRIES: CAUSALITY TESTS FOR CROSS‐COUNTRY PANELS

2006 ◽  
Vol 7 (3) ◽  
pp. 103-110 ◽  
Author(s):  
Hea-Jung Hyun
Keyword(s):  
Developing Countries ◽  
Foreign Direct Investment ◽  
Direct Investment ◽  
Panel Cointegration ◽  
Long Run ◽  
Panel Cointegration Test ◽  
Quality Of Institutions ◽  
Causality Tests ◽  
Short Run

This paper analyzes the short-run and long-run dynamics between quality of institutions and foreign direct investment (FDI) in the sample of 62 developing countries covering the period 1984–2003. Panel cointegration test and FM OLS (Fully Modified OLS) estimators are used to test for cointegration. For short‐run dynamics, we estimate error correction model using fixed effect OLS and system GMM estimators. Institutional quality and FDI are found to have bi‐directional cointegrating relationship in the long-run. However, there is no evidence in favor of short-run causality between two variables.

Exports and outward FDI: are they complements or substitutes? Evidence from Asia

2016 ◽  
Vol 24 (1) ◽  
pp. 62-78 ◽  
Author(s):  
Niti Bhasin ◽  
Justin Paul
Keyword(s):  
Multinational Enterprises ◽  
Home Country ◽  
Panel Cointegration ◽  
Emerging Countries ◽  
Outward Fdi ◽  
Content Type ◽  
Long Run ◽  
Causality Tests ◽  
Relationship Of ◽  
The Relationship

Purpose Outward foreign direct investment (OFDI) and its relationship with exports of home country is an important aspect of internationalization having implications for both policymakers and multinational enterprises (MNEs). This paper aims to examine this relationship by using panel data for ten major emerging countries from Asia over the period 1991-2012. Design/methodology/approach The authors use panel vector auto regression, panel cointegration and causality tests in this study. Findings The authors find evidence of long-run causality from exports to OFDI. Further, exports and OFDI are found to be substitutes. There is no long-run causality from OFDI to exports, implying that MNEs are not “connecting” with home country firms through backward and forward linkages in the production process. Originality/value To the best of the authors’ knowledge, this is the first paper to deal with the relationship of OFDI with exports of the home country, for a group of developing/emerging countries.

Spatial difference analysis of residential energy consumption, income and carbon emissions in China

2017 ◽  
Vol 11 (4) ◽  
pp. 541-556 ◽  
Author(s):  
Yongxia Ding ◽  
Shuwen Niu
Keyword(s):  
Energy Consumption ◽  
Carbon Emissions ◽  
Energy Use ◽  
Panel Cointegration ◽  
Spatial Process ◽  
Residential Energy ◽  
Residential Energy Consumption ◽  
Causality Test ◽  
Content Type ◽  
Residential Sector

Purpose This paper aims to analyze the internal relationships and tendency of residential energy consumption, income and carbon emissions. Design/methodology/approach Taking 30 provinces of China as the analysis unit and dividing them into two types of urban and rural consumer groups, the panel data model was built. In addition, panel unit root test, panel cointegration test and panel Granger causality test were also used. Findings The results showed that there are long-run equilibrium relationships between the three variables, which show the regular tendency in the spatial process. The elasticity coefficients of residential energy consumption and CO2 emissions vary across the three regions and decline continuously from the western to central and eastern regions. In addition, geographic location is also an important factor on the energy consumption and CO2 emissions in residential sector. Originality/value This paper provides some points for policies on cutting energy use and pollution in residential sector.

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