scholarly journals Environmental Degradation in Indonesia and Malaysia: The Effect of Energy Consumption, Economic Growth, Population, and Foreign Direct Investment (FDI)

Author(s):  
Ahmad Farabi ◽  
Azrai Abdullah

The main objective of this study is to examine how energy consumption, economic growth, population, and foreign direct investment (FDI) affects CO2 emissions in Indonesia and Malaysia. This study uses the longest and most updated annual data during the period 1960-2018. To get a deeper analysis, this study employs disaggregate of CO2 emissions and energy consumption data namely, oil, coal and natural gas. The ordinary least square which preceded by unit root test and classical assumption test are employed. The results show that all type of energy consumption affect positively to CO2 emission. Economic growth is identified as the variable with greatest influences on CO2 emissions in oil and natural gas model, while CO2 emissions from coal consumption are mainly affected by populations. The study concludes that economic growth of both countries relies heavily on fossil fuel. CO2 emission sourced from coal mostly affected by population due to the high demand of electricity from household fulfilled by power generation which use coal as the fuel. The EKC hypothesis is confirmed in the model of gas, indicate that natural gas is the most appropriate source of energy to be used at the certain level. Using natural gas is effectively decrease the CO2 emission while in the same time increase the economic growth. Natural gas is also found as the most environmentally friendly fossil fuel due as it produces less CO2 emission compared to oil and coal. The findings have important implications for policy makers in determining policy and business decisions especially to enhance environmentally friendly energy uses for the benefit of the economy.

2021 ◽  
Vol 11 (2) ◽  
pp. 42-52
Author(s):  
Le Hoang Nghiem ◽  
Dang Bac Hai ◽  
Tran Thi Diem Nga ◽  
Su Thi Oanh Hoa

Being a highly vulnerable country due to climate change, Vietnam has issued various climate policies while trying to keep the pace of economic growth. The study evaluates the effectiveness of these policies by examining the effect of economic and energy factors in the efforts of controlling CO2 emissions. Approach by Autoregressive Distributed Lag (ARDL) analysis, the model of a linear regression between CO2 emissions and Gross Domestic Product (GDP), Foreign Direct Investment (FDI) & sources of energy consumption has been developed from 1985 to 2018. The study indicates that the economic factor as Foreign Direct Investment (FDI) is a possible significant element to mitigate the emission. In addition, sources of energy consumption have the important role of controlling CO2 emissions. In the long run, the consumption of non - renewable energy is a positive and significant effect on CO2 emissions while renewable energy is vice versa. These outcomes show the Foreign Direct Investment (FDI) and renewable energy consumption factors lead to the decrease of CO2 emissions in the long run for Vietnam, which implies the co-exist of economic growth and decarbonization.


2021 ◽  
Vol 4 (1) ◽  
pp. 13-25
Author(s):  
Shabana Parveen ◽  
Bibi Aisha Sadiqa ◽  
Farrah Yasmin ◽  
Sher Ali

Economic growth is a process that is not possible without a lot of energy consumption. Energy is considered as the life blood of an economy however, the energy consumption is also an important factor responsible for degrading the natural environment of the world. The present empirical work is an effort to empirically analyze the association of energy use (kg of oil equivalent per capita) with economic growth (GDP per capita annual growth), foreign direct investment (FDI net inflow as percentage of GDP), and environmental degradation (CO2 emissions, metric tons per capita) in case of Pakistan. The work is based on time series data for the years 1975 to 2018. Canonical cointegrating regression (CCR) method is used for the estimation of the coefficient of the  parameters. The results demonstrate that  energy use has  significant positive association with  FDI, economic growth,  and CO2 emissions. The empirical results recommend that policy makers in Pakistan require to work on policies regarding sustainable development and efficient use of energy as without achieving the efficiency in energy use, the desirable growth of the economy without environmental degradation cannot be achieved.


2016 ◽  
Vol 21 (1) ◽  
pp. 9-20
Author(s):  
Ersalina Tang

The purpose of this study is to analyze the impact of Foreign Direct Investment, Gross Domestic Product, Energy Consumption, Electric Consumption, and Meat Consumption on CO2 emissions of 41 countries in the world using panel data from 1999 to 2013. After analyzing 41 countries in the world data, furthermore 17 countries in Asia was analyzed with the same period. This study utilized quantitative approach with Ordinary Least Square (OLS) regression method. The results of 41 countries in the world data indicates that Foreign Direct Investment, Gross Domestic Product, Energy Consumption, and Meat Consumption significantlyaffect Environmental Qualities which measured by CO2 emissions. Whilst the results of 17 countries in Asia data implies that Foreign Direct Investment, Energy Consumption, and Electric Consumption significantlyaffect Environmental Qualities. However, Gross Domestic Product and Meat Consumption does not affect Environmental Qualities.


Energies ◽  
2021 ◽  
Vol 14 (2) ◽  
pp. 332
Author(s):  
Janusz Grabara ◽  
Arsen Tleppayev ◽  
Malika Dabylova ◽  
Leonardus W. W. Mihardjo ◽  
Zdzisława Dacko-Pikiewicz

In this contemporary era, environmental problems spread at different levels in all countries of the world. Economic growth does not just depend on prioritizing the environment or improving the environmental situation. If the foreign direct investment is directed to the polluting industries, they will increase pollution and damage the environment. The purpose of the study is to consider the relationship between foreign direct investment in Kazakhstan and Uzbekistan and economic growth and renewable energy consumption. The study is based on data obtained from 1992 to 2018. The results show that there is a two-way link between foreign direct investment and renewable energy consumption in the considered two countries. The Granger causality test approach is applied to explore the causal relationship between the variables. The Johansen co-integration test approach is also employed to test for a relationship. The empirical results verify the existence of co-integration between the series. The main factors influencing renewable energy are economic growth and electricity consumption. To reduce dependence on fuel-based energy sources, Kazakhstan and Uzbekistan need to attract energy to renewable energy sources and implement energy efficiency based on rapid progress. This is because renewable energy sources play the role of an engine that stimulates the production process in the economy for all countries.


2021 ◽  
pp. 0958305X2110453
Author(s):  
Jaleel Ahmed ◽  
Shuja ur Rehman ◽  
Zaid Zuhaira ◽  
Shoaib Nisar

This study examines the impact of financial development on energy consumption for a wide array of countries. The estimators used for financial development are foreign direct investment, economic growth and urbanization. The study employed a panel data regression on 136 countries with time frame of years 1990 to 2019. The model in this study deploys system GMM technique to estimate the model. The results show that financial development has a significant negative impact on energy consumption overall. Foreign direct investment and urbanization has significant impact on energy consumption. Also, economic growth positive impact on energy consumption its mean that economic growth promotes energy consumption. When dividing further the sample into different groups of regions such as Asian, European, African, North/Latin American and Caribbean countries then mixed results related to the nexus between financial development and energy consumption with respect to economic growth, urbanization and foreign direct investment. The policymakers in these different groups of countries must balance the relationship between energy supply and demand to achieving the sustainable economic development.


2019 ◽  
Vol 4 (02) ◽  
pp. 113
Author(s):  
Melati Intan Kurnia ◽  
Hadi Sasana ◽  
Yustirania Septiani

<p><em>Increasing economic growth will spark against increased energy consumption. But on the other hand, increasing economic growth will also trigger the occurrence of natural damage and degradation of environmental quality derived from CO2 emissions. CO2 emissions are caused by oxidation process of fossil fuel energy. This research aims to know the causality relationship between CO2 emissions, fossil fuel consumption, electricity consumption, and economic growth in Indonesia, as well as long-term relationship between CO2 emissions, fossil fuel consumption, electricity consumption, to economic growth in Indonesia in 1990 – 2019. The used data is the secondary data that is in the form of data time series. The dependent variables of this study are economic growth, while independent variables are CO2 emissions, fossil fuel consumption, electricity consumption. The method that is used in this study is Vector Error Correction Model. The results showed that there was a one-way causality between economic growth and fossil fuel consumption, and between electricity consumption and CO2 emissions. The research also shows that on long-term CO2 emissions has a negative influence, while the consumption of fossil fuels and electricity has a positive effect on Indonesia's economic growth in 1990-2019.</em></p><p><strong><em>K</em></strong><strong><em>eywords</em></strong><em>: CO2, Energy Consumption, Economic Growth.</em></p>


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