Assessing the Impact of Factors Driving Global Carbon Dioxide Emissions

The aim of this study is to empirically investigate the causal relationship between global CO2 emissions and six of their potentially contributing factors (i.e., economic growth, energy consumption, population, trade openness, financial development and corruption), by using a panel data collected from 65 countries during 1995 to 2013. We developed a dynamic model and used a four-step testing procedures (i.e., panel unit root tests, panel cointegration tests, long-run estimates, i.e. FMOLS estimates and a Granger causality test). The results showed that the most important factors driving global CO2 emissions were economic growth, energy consumption, corruption and financial development. It is recommended that countries develop their own CO2 reducing policies by designing an appropriate combination/mix of policy tools, such as regulation, economic, voluntary and educational/ informational instruments to address their environmental pollution. Countries could consider all dimensions of well-being when they measure their economic development. Imposing pollution taxes on fossil fuel based energy supplies, developing emissions standards, strengthening anti-corruption strategies and educating people about the adverse effects of CO2 emissions on the natural environment and human health are potential policy measures.

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The Impact of Energy Consumption and Economic Growth on Carbon Dioxide Emissions

Sustainability ◽

10.3390/su12197965 ◽

2020 ◽

Vol 12 (19) ◽

pp. 7965

Author(s):

Oluyomi A. Osobajo ◽

Afolabi Otitoju ◽

Martha Ajibola Otitoju ◽

Adekunle Oke

Keyword(s):

Economic Growth ◽

Energy Consumption ◽

Granger Causality ◽

Co2 Emissions ◽

Carbon Dioxide Emissions ◽

Fixed Effects ◽

Positive Impact ◽

Clean Energy ◽

Cointegration Tests ◽

The Impact

This study explored the effect of energy consumption and economic growth on CO2 emissions. The relationship between energy consumption, economic growth and CO2 emissions was assessed using regression analysis (the pooled OLS regression and fixed effects methods), Granger causality and panel cointegration tests. Data from 70 countries between 1994–2013 were analysed. The result of the Granger causality tests revealed that the study variables (population, capital stock and economic growth) have a bi-directional causal relationship with CO2 emissions, while energy consumption has a uni-directional relationship. Likewise, the outcome of the cointegration tests established that a long-run relationship exists among the study variables (energy consumption and economic growth) with CO2 emissions. However, the pooled OLS and fixed methods both showed that energy consumption and economic growth have a significant positive impact on CO2 emissions. Hence, this study supports the need for a global transition to a low carbon economy primarily through climate finance, which refers to local, national, or transnational financing, that may be drawn from public, private and alternative sources of financing. This will help foster large-scale investments in clean energy, that are required to significantly reduce CO2 emissions.

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Modelling Energy Consumption, Carbon Dioxide Emissions and Economic Growth Nexus in Ethiopia: Evidence from Cointegration and Causality Analysis

Turkish Journal of Agriculture - Food Science and Technology ◽

10.24925/turjaf.v6i6.699-709.1720 ◽

2018 ◽

Vol 6 (6) ◽

pp. 699 ◽

Cited By ~ 4

Author(s):

Shemelis Kebede Hundie

Keyword(s):

Economic Growth ◽

Energy Consumption ◽

Co2 Emissions ◽

Financial Development ◽

Environmental Sustainability ◽

Carbon Dioxide Emissions ◽

Positive Impact ◽

Trade Openness ◽

Causality Analysis ◽

The Impact

Policy makers need to know the relationship among energy use, economic growth and environmental quality in order to formulate rigorous policy for economic growth and environmental sustainability. This study analyzes the nexus among energy consumption, affluence, financial development, trade openness, urbanization, population and CO2 emissions in Ethiopia using data from 1970–2014. The ARDL cointegration results show that cointegration exists among the variables. Energy consumption, population, trade openness and economic growth have positive impact on CO2 in the long-run while economic growth squared reduces CO2 emissions which confirms that the EKC hypothesis holds in Ethiopia. In the short-run urbanization and energy consumption intensify environmental degradation. Toda-Yamamoto granger causality results indicate the bi-directional causality between energy consumption and CO2 emissions, CO2 emissions and urbanization. Financial development, population and urbanization cause economic growth while economic growth causes CO2 emissions. Causality runs from energy consumption to financial development, urbanization and population which in turn cause economic growth. From the result, CO2 emissions extenuation policy in Ethiopia should focus on environmentally friendly growth, enhancing consumption of cleaner energy, incorporating the impact of population, urbanization, trade and financial development.

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The Nexus between Financial Development, Economic Growth and Energy Consumption in India: A VECM Technique

Indian Journal of Economics and Development ◽

10.35716/ijed/20131 ◽

2020 ◽

pp. 602-612

Keyword(s):

Economic Growth ◽

Energy Consumption ◽

Financial Development ◽

Consumer Price Index ◽

Development Economic ◽

Energy Prices ◽

Vector Error Correction ◽

Percent Increase ◽

Growth Energy ◽

The Impact

The demand for energy consumption requires efficient financial development in terms of bank credit. Therefore, this study examines the nexus between Financial Development, Economic Growth, Energy Prices and Energy Consumption in India, utilizing Vector Error Correction Model (VECM) technique to determine the nature of short and long term relationships from 2010 to 2019. The estimation of results indicates that a one percent increase in bank credits to private sector results in 0.10 percent increase in energy consumption and 0.28 percent increase in energy consumption responses to 1 percent increase in economic growth. It is also observed that the impact of energy price proxied by consumer price index is statistically significant with a negative sign indicating the consistency with the theory.

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CO2 Emissions, Energy Consumption, and Economic Growth Nexus: Evidence from 30 Provinces in China

Mathematical Problems in Engineering ◽

10.1155/2020/8842770 ◽

2020 ◽

Vol 2020 ◽

pp. 1-10

Author(s):

Shaohui Zou ◽

Tian Zhang

Keyword(s):

Economic Growth ◽

Carbon Dioxide ◽

Energy Consumption ◽

Co2 Emissions ◽

Carbon Dioxide Emissions ◽

Spillover Effect ◽

Low Carbon ◽

Spatial Spillover ◽

Dynamic Relationship ◽

Growth Energy

Under the situation of global low-carbon development, the contradiction among energy consumption, economic growth, and CO2 emissions is increasingly prominent. Considering the possible two-way feedback among the three, based on the panel data of 30 regions in China from 2000 to 2017, this paper establishes a spatial Durbin model including economic growth, energy consumption equation, and CO2 emissions and studies the dynamic relationship and spatial spillover among economic growth, energy consumption, and CO2 emissions effects. The results show that the economic growth can significantly improve carbon dioxide emissions, and China’s economic growth level has become a positive driving force for carbon dioxide emissions. However, economic growth will not be significantly affected by the reduction of carbon dioxide emissions. There is a two-way relationship between energy consumption (ENC) and carbon dioxide emissions (CO2). Energy consumption and carbon emissions are interrelated, which has a negative spatial spillover effect on the carbon dioxide emissions of the surrounding provinces and cities.

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Financial Development and CO2 Emissions in Post-Transition European Union Countries

Sustainability ◽

10.3390/su12072640 ◽

2020 ◽

Vol 12 (7) ◽

pp. 2640 ◽

Cited By ~ 3

Author(s):

Yilmaz Bayar ◽

Laura Diaconu (Maxim) ◽

Andrei Maxim

Keyword(s):

Economic Growth ◽

Energy Consumption ◽

Co2 Emissions ◽

Financial Development ◽

Carbon Dioxide Emissions ◽

Panel Cointegration ◽

Financial Sector ◽

Primary Energy ◽

Primary Energy Consumption ◽

Financial Sector Development

Carbon dioxide emissions are on the rise, posing a serious global issue. Therefore, it is important that policymakers identify the exact causes of these emissions. This paper investigates the influence of financial development, primary energy consumption, and economic growth on CO2 emissions in 11 post-transition European economies. The assessment was made for the 1995–2017 period using panel cointegration and causality analyses. The causality analyses did not reveal significant connection between financial sector development and CO2 emissions, but rather a two-way causality between primary energy consumption and economic growth, on one hand, and CO2 emissions on the other. Meanwhile, long-run analysis disclosed that financial sector development and primary energy consumption positively affected CO2 emissions. Our results seek to grab the attention of policy makers, who could work towards creating country-specific strategies that balance the relationship between financial development and CO2 emissions. These long-term policies could ensure both development of the financial sector and environmental protection.

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The impact of economic growth, energy consumption, trade openness, and financial development on carbon emissions: empirical evidence from Turkey

Environmental Science and Pollution Research ◽

10.1007/s11356-018-3526-5 ◽

2018 ◽

Vol 25 (36) ◽

pp. 36589-36603 ◽

Cited By ~ 45

Author(s):

Murat Cetin ◽

Eyyup Ecevit ◽

Ali Gokhan Yucel

Keyword(s):

Economic Growth ◽

Energy Consumption ◽

Empirical Evidence ◽

Financial Development ◽

Carbon Emissions ◽

Trade Openness ◽

Growth Energy ◽

The Impact

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Impact of Private Investment, Economic Growth and Financial Development on Environmental Degradation: Evidence from Pakistan

Review of Economics and Development Studies ◽

10.47067/reads.v7i1.313 ◽

2021 ◽

Vol 7 (1) ◽

pp. 13-24

Author(s):

Shabana Parveen ◽

Bibi Aisha Sadiqa ◽

Sher Ali ◽

Farrah Yasmin

Keyword(s):

Economic Growth ◽

Energy Consumption ◽

Linear Regression ◽

Regression Model ◽

Co2 Emissions ◽

Financial Development ◽

Environmental Degradation ◽

Linear Regression Model ◽

Private Investment ◽

The Impact

Private investment plays an important role in the process of economic growth and also impact natural environment of a country. The main purpose of the present study is to empirically analyze the impact of private investment and other macro economic variables on environmental degradation of Pakistan. For the purpose, time series data is collected for the years 1975 to 2017. The study used Linear regression model for analyzing the impact of private investment, energy consumption, financial development and economic growth on environmental degradation. Augmented Dickey Fuller (ADF) test and Phillips Perron (PP) test is used for identifying the unit root of the variables; first with an intercept then, with an intercept and a linear deterministic trend. Akaike Information Criterion (AIC) is used for selection of optimum lag whereas Johansen cointegration test is adopted for analyzing long run association in the variables. The results of linear regression model show that energy consumption and economic growth have a positive and statistically significant impact on CO2 emissions whereas the impact of private investment on CO2 emissions is negative. It means that in Pakistan, private investment is environment friendly. Based on study results, it is recommended that when formulating policies for economic growth and development, motivation should be given to private inverters in order to increase private investment.

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The Effect of Renewable and Nuclear Energy Consumption on Decoupling Economic Growth from CO2 Emissions in Spain

Energies ◽

10.3390/en13092124 ◽

2020 ◽

Vol 13 (9) ◽

pp. 2124 ◽

Cited By ~ 5

Author(s):

Mariola Piłatowska ◽

Andrzej Geise ◽

Aneta Włodarczyk

Keyword(s):

Economic Growth ◽

Renewable Energy ◽

Energy Consumption ◽

Co2 Emissions ◽

Carbon Dioxide Emissions ◽

Nuclear Energy ◽

Green Energy ◽

Annual Data ◽

Renewable Energy Consumption ◽

The Impact

This study examines the relationship between renewable and nuclear energy consumption, carbon dioxide emissions and economic growth by using the Granger causality and non-linear impulse response function in a business cycle in Spain. We estimate the threshold vector autoregression (TVAR) model on the basis of annual data from the period 1970–2018, which are disaggregated into quarterly data to obtain robust empirical results through avoiding a sample size problem. Our analysis reveals that economic growth and CO2 emissions are positively correlated during expansions but not during recessions. Moreover, we find that rising nuclear energy consumption leads to decreased CO2 emissions during expansions, while the impact of increasing renewable energy consumption on emissions is negative but insignificant. In addition, there is a positive feedback between nuclear energy consumption and economic growth, but unidirectional positive causality running from renewable energy consumption to economic growth in upturns. Our findings do indicate that both nuclear and renewable energy consumption contribute to a reduction in emissions; however, the rise in economic activity, leading to a greater increase in emissions, offsets this positive impact of green energy. Therefore, a decoupling of economic growth from CO2 emissions is not observed. These results demand some crucial changes in legislation targeted at reducing emissions, as green energy alone is insufficient to reach this goal.

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