Top PDF How economic growth and energy consumption contribute to environmental degradation?

How economic growth and energy consumption contribute to environmental degradation?

How economic growth and energy consumption contribute to environmental degradation?

This paper explores the relationship between environmental degradation (measured by the ratio of carbon dioxide emissions), economic growth and energy consumption in case of Hungary over the period of 1990-2014 by annual data. To ascertain the integrating properties of the variables, the Zivot-Andrews unit root test was employed. The ARDL bounds testing approach and Gregory-Hansen structural break test have been adopted to test the relationship between the variables in the presence of structural break. Structural breaks occurred in the first half of the 2000s in the series of carbon dioxide emissions and energy consumption, while economic growth has a structural break in the middle of 1990s. My research shows that carbon dioxide emissions are influenced in several ways by the above-mentioned factors. The impact of energy consumption is time variant on carbon dioxide emissions and statistically significant in the short and long term. One-year delay, increasing in energy consumption results decline in carbon dioxide emissions while increasing in level of energy consumption is linked with increases in economic growth. The economic growth also has an important role in carbon dioxide emissions. Its increasing contributes to reduce carbon dioxide emissions in the short and long run. It is concluded that economic growth and energy consumption are in the background of the air quality and economic growth mitigates carbon dioxide emissions.
Show more

16 Read more

Impact of Financial Development, Economic Growth and Energy Consumption On Environmental Degradation: Evidence from Pakistan

Impact of Financial Development, Economic Growth and Energy Consumption On Environmental Degradation: Evidence from Pakistan

economies that are producing more carbon and according to the World Bank, it is contributing about 7 to 8 percent carbon dioxide yearly in Global warming. The trend is continually moving upward due to high investment in industries, an increase in population size and most importantly, Pakistan is highly dependent on energy consumption, i.e., approximately 60 percent consumption of gas and oil. In order to mitigate this sensitive issue, this research is conducted to analyze the role of financial development, energy consumption, economic growth, on environmental degradation in Pakistan by using the data from 1972-2014. We applied the stationary analysis, co- integration and regression analysis to examine the association between the energy consumption, financial development, economic growth and environmental degradation. The empirical evidence showed that all the variables have a significant positive effect on environmental degradation which means an increase in any variable will increase the environmental degradation.
Show more

26 Read more

Economic growth, military spending and environmental degradation in Africa

Economic growth, military spending and environmental degradation in Africa

The purpose of this paper was to examine the effects of military spending on CO2, NO2 and CH4 emissions in Africa. From the panel data for 54 countries and a period from 1980 to 2016, the GMM method and the structural VAR model were applied. Overall, it appears that the relationship between the main greenhouse gas emissions in this study and GDP is in the form of '' inverted N '' or '' N ''. The explanatory variables selected have different effects depending on the models. However, our interest variable helps to degrade the environment regardless of the environmental degradation indicator used. Economic growth plays an important role in spreading shocks from military spending to the environment.
Show more

16 Read more

Economic Growth and Environmental Degradation in Nigeria: Beyond the Environmental Kuznets Curve

Economic Growth and Environmental Degradation in Nigeria: Beyond the Environmental Kuznets Curve

The Environmental Kuznets Curve (EKC) hypothesis is a presumption that environmental degradation follows an inverted U-shaped trajectory in relation to economic growth. The thorny question of whether economic growth could provide a cure to environmental degradation has sparked off a large body of empirical studies in the last decade. The conclusions have been mixed. This study contributes to the debate on the existence and policy relevance of the EKC for Nigeria by applying autoregressive distributed lag (ARDL) framework to annual time series data from 1960 to 2008. The traditional EKC model is extended by including (in addition to the level, square and cubed values of the income variable), trade openness as well as the shares of manufacturing, agriculture and service sectors in Nigeria’s GDP. Using Co2 emissions per capita to proxy environmental degradation, our findings do not support the existence of the EKC hypothesis. Rather our results show that Nigeria’s situation when confronted with data is exemplified by an N-shaped relationship with a turning point at $77.27 that lies below the data set used for the study. Based on these findings, the paper posit that the hypothesized EKC serves as a dangerous policy guide to solving environmental problems in Nigeria. The conclusion is that to ensure sustainability, there exist an urgent need to look beyond the EKC by adopting courageous policy measures of environmental preservation in Nigeria irrespective of the country’s level of income.
Show more

29 Read more

Environmental Degradation and Economic Growth in ASEAN-10: The Perspective of EKC Hypothesis

Environmental Degradation and Economic Growth in ASEAN-10: The Perspective of EKC Hypothesis

Abstract: Environmental issues have been ranked among the most intense debates over the past decades by governments around the world. Sustainable development goals have been top priorities in the working agenda of national cabinets and administrations which questions the chronic trade-off between environment and economic performance. This paper aims at contributing further insights into the above-mentioned linkage to the contemporary literature by testing the validity of the environmental Kuznets curve (EKC) hypothesis. By conducting a panel data analysis on ASEAN-10 countries’ statistics of carbon dioxide emissions per capita (COEpc), real gross domestic product per capita (rGDPpc), foreign direct investment inflow (FDIif), trade openness index (TOI), and urbanisation (URB), the findings have empirically confirmed the valid causality running from economic growth, international trade and demographic changes to environmental degradation. Additionally, the existence of an earlier inverted U-shaped and a later N-shaped EKC has been investigated and significantly confirmed the cyclical changes of the eco-enviro trade-off. Also, this paper provides implications for policymakers to consider the cost-benefit issue in the establishment and implementation of economic and environmental protection policies.
Show more

20 Read more

The Impact of Economic Integration and Economic Growth on Environmental Degradation in Five Asian Countries

The Impact of Economic Integration and Economic Growth on Environmental Degradation in Five Asian Countries

Xuan Wang (2011) paper focused on quick economic integration due to the more globalization has two different influences: on one side, it increases productivity and contributes to economic growth; but on the other side, it worsens the environmental conditions and leads a severe environmental degradation problem. Economic prosperities are developing under the traditional GDP or GNP measurement; however, the real human welfare cannot be ascertained as really increasing, when taking the negative externalities into account. This paper tests the effect of openness to international trade at Chinese provincial level, by applying Comparable Green GDP data from 31 provinces and regions to a variant of Solow growth model. The main finding is: there exists a non-linear relationship between green GDP and openness, measured both by volume of trade and foreign directly investment (FDI), at provincial level. Spontaneously, openness has an inverted U shape effect: it increases sustainable development at the beginning and decreases sustainable development after a threshold point. This result accords with the finding by Talberth&Bohara (2006) at national level.
Show more

10 Read more

Economic growth, Environmental degradation and business cycles in Eswatini

Economic growth, Environmental degradation and business cycles in Eswatini

ABSTRACT: This study investigates the impact of the business cycle on the Environmental Kuznets Curve (EKC) for the Eswatini Kingdom over the period 1970 – 2014. To this end, we employ the nonlinear autoregressive distributive lag (NARDL) model to capture the long-run and short-run cointegration effects between economic activity and greenhouse gas (GHG) emissions over different phases of the business cycle. Our findings reveal that economic activity only degrades the environment during upswing of the economic cycle whilst this relationship is insignificant during downswing of the cycle. We specifically compute a value of $3.57 worth of output been gained at the cost of a metric unit of emissions during economic expansionary phases. Altogether, these results insinuate much needed government intervention in the market for emissions via environmental tax reforms (ETR) which should be designed with countercyclical bias towards upswing the business cycle.
Show more

16 Read more

Economic Growth and Environmental Degradation

Economic Growth and Environmental Degradation

understanding of the relationship between emissions and economic growth could be revealed by examining the local economy surrounding the monitoring station. i This study differs from past studies in that it analyzes the more localized relationship between the environment and the economy. Specifically, this study examines the relationship between the gross domestic product (GDP) of a metropolitan statistical area (MSA) with the emissions reported by the monitoring stations within that same MSA. This study also expands upon past research by using a highly accurate data set for emissions offered through the U.S. Environmental Protection Agency’s (EPA) Air Quality System (AQS).
Show more

32 Read more

Do oil consumption and economic growth intensify environmental degradation? Evidence from developing economies

Do oil consumption and economic growth intensify environmental degradation? Evidence from developing economies

The above review suggests that the relationship between oil consumption and economic growth varies across countries, periods and methods. Moreover, most of the studies have been conducted on individual Asian countries using time series techniques, and panel frameworks are scarce. As most of the studies address the causality within an individual country, their findings cannot be generalised as the results suffer from a short data span that leads to a reduction of the unit root and cointegration test power. Further, most of the existing literature focuses on a causal link from a bivariate model and ignores the dynamic relationship from a multivariate model. Hence, this study is a modest attempt to address these limitations, and to contribute to the body of knowledge in this area and provide potential policy implications for sustainable economic growth.
Show more

39 Read more

Energy Consumption, CO2 Emissions, and Economic Growth: A Moral Dilemma

Energy Consumption, CO2 Emissions, and Economic Growth: A Moral Dilemma

Thought provokingly, the answer may not even be that of sustainable growth. To be more explicit, findings give outright prominence to alternative paradigms, such as those of degrowth and a-growth . With regard to degrowth, (Kallis, 2011, p. 874) ex- plains that this is ‘a socially sustainable and equitable reduction of society’s throughput’. Throughput, defined by Daly (1996) as the material and energy required by contemporary societies for the production, distribution, as well as, consumption of goods and assimila- tion of waste, has to be reduced in order for environmental degradation to be kept within specific limits and to start decelerating (Kallis, 2011). It follows that degrowth, contrary to sustainable growth, cannot occur within a framework of rising GDP. The paradigm of a-growth, on the other hand, can be described as even more radical one, as it implies that societies should concentrate solely on rigorous environmental policies disregarding the effects this might have on the future levels of GDP (van den Bergh, 2011).
Show more

32 Read more

Environmental Degradation, Energy consumption, Population Density and Economic Development in Lebanon: A time series Analysis (1971 2014)

Environmental Degradation, Energy consumption, Population Density and Economic Development in Lebanon: A time series Analysis (1971 2014)

Rothman (1998) investigates the relationship of economic development and environmental degradation in case of some selected developed countries by using the data of different point of time. He concludes that there is an inverted U-shaped relationship between economic growth and environmental degradation. Junyi (2006) investigates the relation of EKC and income per capita in case of Chinese provinces, for that he uses data from 1993 to 2002. He uses simultaneous equation model (SEM) for investigation of relationship of pollutant emission per capita and income per capita and 2SLS is used for estimation of SEM. He uses Hausman methodology for understanding the exogeneity of income in his model, the results of the Hausman test confirms that there is simultaneity between pollution emissions and income per capita. The overall results of the study confirm that in some provinces there is inverted U-shaped relation between income and pollution, but in case of poor provinces they need more wealth for improved environmental conditions.
Show more

16 Read more

Does energy consumption contribute to economic performance? Empirical evidence from Nigeria

Does energy consumption contribute to economic performance? Empirical evidence from Nigeria

Thus, this implies that electricity production should be- come an economic policy high-priority objective which should be urgently responded to. Energy efficiency is al- so called ‘efficient energy use’. It is not just about reduce- ing utility bills of energy. It also involves boosting revenue through greater productivity. Energy efficiency is an indis- pensable component of any effort to improve electricity productivity. Ultimately, energy efficiency contributes to wealth, Oviemuno (2006). Energy efficiency provides another option for meeting air quality goals in that com- bustion volumes are reduced proportionately with fossil fuel consumption. Energy Efficiency refers to the im- provement of products and practices that result in a re- duction in the amount of energy necessary to provide energy services such as lighting, cooking, heating, coo- ling, transportation and manufacturing (Amaewhule, 2000). Classical economists did not recognize energy as a factor of production in the production process and nei- ther did the Neoclassicals. Today, economists like Alam (2006) found out in his work on ‘Economic Growth with Energy’ that not only does energy serve as a factor of production; it also acts as a booster to growth of a nation.
Show more

15 Read more

Relationship of Energy Consumption and Economic Growth in Pakistan

Relationship of Energy Consumption and Economic Growth in Pakistan

Sharif et al (2019), observed the association of consumption of energy with CO2 emission. There is a number of researchers that investigated the relationship between the renewable and non-renewable usage of energy with ecological deterioration. This study also investigates the association of these variables for panel data during the span of 1990 to 2015 of 74 countries. The author investigated the long-run correlation amongst the variables by applying panel co-integration method examine the long-run effect using (FMOLS) approach. According to outcomes, it is suggested that countries of more carbon emissions must require to develop national as well as international policies to deal an environmental degradation but also the reduction of non-renewable power utilization as well. Beside this, these nations also required to encourage renewable power ingesting in all the sectors of the economy.
Show more

13 Read more

Energy consumption, emissions and economic growth in an oil producing country

Energy consumption, emissions and economic growth in an oil producing country

The concern about climate change and the adoption of Kyoto Protocol in late 1997 have attracted economists to study further the energy-economic growth relationship with respect to steps to alleviate the greenhouse gas (GHG) effects to be taken by the signatory parties. To address this issue, the standard bivariate or multivariate model is modified to include GHG indicators. Kyoto Protocol outlines six GHGs, namely, carbon dioxide (CO2), methane (CH4), nitrous oxide (N20), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulphur hexafluoride (SF6). Most studies use CO2 as the indicator of GHG emissions as it constitutes major part of the emissions and its data is annually observed and easily available. We can categorize this type of studies into two groups. This first group adopts environmental Kuznets curve (EKC) hypothesis. This hypothesis argues that the environment and economic growth has an inverted U-shaped curve. This non-linear relationship shows that environmental degradation is positively associated with economic growth at certain stages of economy, particularly early stages of economic development. However, once the economy grows beyond a certain threshold, the relationship turns to be negative. In the latter situation, the environmental conservation has positive correlation with economic growth whereas the environmental degradation has negative correlation with the economy. Stern (2004), Dinda (2004), Aslanidis (2009) and Kijima et al. (2010) provide reviews of the EKC studies. Stern (2004) concludes that previous EKC studies were not robust as they failed to give clear finding on the inverted U-shaped relationship between environment and economic growth as income rises. Dinda (2004) also concludes that previous studies did not provide concrete finding when the negative correlation between environmental degradation and economic growth starts. Therefore, Dinda suggests that, among others, new economic modeling is needed to reflect the important feedback relationship between economic growth and environment. A current survey by Kijima et al. (2010) also shows the similar conclusion on EKC literatures. In this case, Bo (2011) suggests careful selection of indicators in order to examine the environment-economic growth relationship since the previous EKC model use simplified modeling.
Show more

16 Read more

CO2 emissions, energy consumption and economic growth in Tunisia

CO2 emissions, energy consumption and economic growth in Tunisia

The existing literature reveals that empirical finding studies differ substantially and are not conclusive to present policy recommendation that can be applied across countries. In addition, few studies focus to test the nexus of output-energy and output-environmental degradation under the same integrated framework. Given that energy consumption has a direct impact on the level of environmental pollution, the above discussion highlights the importance of linking these two strands of literatures together (Ang, 2007 and 2008). Consequently, to avoid problems of misspecification, these two hypotheses must be tested under the same framework.
Show more

5 Read more

Economic growth, energy consumption, and quality environment in Nigeria

Economic growth, energy consumption, and quality environment in Nigeria

The policy recommendations of the study are as follows. First, efficient use of primary energy to achieve economic growth should be a priority of policymakers through designing a ratio of primary energy to labour and capital for a certain level of output. Achieving this will further require monitoring the production sector of the Nigerian economy. Second, the introduction of environmental tax policy on related primary energy products could be a useful policy measure to increase efficiency in energy utilisation and awareness about environmental quality. For example, 1% of Environmental Added Tax (EAT) can be included in the selling price of an energy- related product like the Value Added Tax (VAT). This will go a long way in creating awareness and reducing environmental degradation. Third, more emphasis on human capital development is required by the government to transform the benefit of the large labour force into comparative production advantage in Nigeria. This will require stringent implementation of the acquisition of basic education, especially, primary and secondary school education in Nigeria. Finally, since trade openness has revealed a positive impact on both economic growth and environmental quality, the government should give more attention to good trade relations with comparative and absolute advantages. This will bring in new technologies, increase specialization, economic growth and subsequently improves environmental quality in Nigeria.
Show more

8 Read more

How Renewable Energy Consumption Contribute to Environmental Quality? The Role of Education in OECD Countries

How Renewable Energy Consumption Contribute to Environmental Quality? The Role of Education in OECD Countries

development is a problem faced by most of the countries around the globe, and the developed nations are no exception to that. Environmental awareness-oriented policy design for achieving sustainable development goals is a challenge for the developed nations, and there lies the contribution of this study. This study analyzes the impact of renewable energy on carbon emissions, in presence of education, natural resource abundance, foreign direct investment, and economic growth for the Organization for Economic Co-operation and Development countries over the period of 1990-2015. Second generation methodologies are adapted for the empirical estimation. The results show the stimulating role of renewable energy consumption in shaping environmental quality. Education declines carbon emissions. Natural resource abundance and foreign direct investment deteriorate environmental quality. Moreover, the time series individual country analysis also confirms that renewable energy has a positive impact on economic growth. The heterogeneous causality analysis reveals the feedback effect, i.e., bidirectional causal associations among carbon emissions, education, and renewable energy consumption. This empirical evidence suggests that countries should increase investment in education and renewable energy sectors and plan for research and development in renewable energy for ensuring environmental sustainability.
Show more

48 Read more

Energy Consumption and Economic Growth in Pakistan: A Sectoral Analysis

Energy Consumption and Economic Growth in Pakistan: A Sectoral Analysis

unidirectional causal relation move from economic growth to energy consumption and in the short run it move towards economic growth from capital. The conclusion of this study demonstrates that the key ingredient of economic development in India is capital accumulation. Bartleet & Gounder (2010) analyzed the energy usage and economic growth nexus in New Zealand. They have used annual time series data for the time span ranging from 1960 to 2004 and applied autoregressive distributed lag, Granger-causality trivariate and multivariate estimates for estimation. The Granger-causality was found from real GDP to energy consumption. The conclusion implied that economic and environmental policy objectives may be simultaneously achievable and the breadth of policy options may not be limited to energy instruments. Narayan & Smyth (2008) aimed at investigating the link of energy consumption with real GDP in G7 countries. They used annual data for the time period 1972 to 2002 and panel cointegration, OLS estimator, FMOLS estimator and dynamic OLS (DOLS) estimator were employed in this study. The findings of the study showed that there exists bidirectional causality between real GDP, capital formation and energy consumption in the selected economies.
Show more

58 Read more

Fuel Wood Consumption and Environmental Degradation in Nigeria

Fuel Wood Consumption and Environmental Degradation in Nigeria

The incidence of environmental degradation in Nigeria is becoming alarming due to increasing level of environmental abuse or unwise and careless exploitation of environmental resource such as fuel wood. Greater proportion of both urban and rural dwellers in Nigeria now depends on the fuel wood as a source for energy for their domestic and other commercial uses. This action is progressively degrading the environment weakening its capacity for self renewal and eroding its ability to play effectively its ecological roles. This paper therefore, highlights the degrading effects of fuel wood consumption on the environment, examining the major economic issues that sustain over dependence on fuel wood consumption. Practicable measures capable of reversing the ugly trends are suggested. Very importantly, the paper recognized poverty and unemployment a major factor that continue to fire – up the massive utilization of fuel wood in the country and calls for an urgent measure to reduce poverty and raise the purchasing power of the people.
Show more

10 Read more

Pollutant Emissions, Energy Consumption and Economic Growth in Nigeria

Pollutant Emissions, Energy Consumption and Economic Growth in Nigeria

The Nigerian economy has experienced phenomenal growth over the last one decade with the growth rate averaging about 6% in the last few years. Being the most populous nation in Africa with an estimated population of over 160 million, this rapid growth has enlisted this country as the fastest growing economy among developing nations. However, with this strong economic growth, Nigeria demand for energy is increasing just as pollutant emissions (Figure 1). This is because an attempt to achieve higher growth rate and development is usually at the expense of the environment. According to Olarinde et al., (2014), Nigeria`s GDP per capita growth rate in 2011 was 249.52% higher than 1980 value. Although in 2011 the CO 2 emission per capita experienced a decline with a growth rate of –50.42% of 1980 value, this was not enough to reduce the level of carbon intensity. The country’s carbon intensity experienced a marginal increase of about 12.11% of 1980. This is not surprising, given that manufacturing share of the country’s GDP was significantly higher than other sectors’, with services sector which is expected to be environmental-friendly accounting for only 26.6% of the GDP in 2010 fiscal year (Table 1).
Show more

7 Read more

Show all 10000 documents...

Related subjects