Industry-specific determinants of environmental indicators

The debate about exploring the drivers of pollution, material consumption and energy use has centred on estimating environmental Kuznet curves for countries in a time series, cross-sectional or panel analysis. Very often, evidence is mixed since especially institutional frameworks, market conditions and environmental policies are different between countries. This paper analyses industrial branches mirrored in the National Accounting Matrix including Environmental Accounts system with specific emphasis on the connections between the industrial production and selected environmental indicators in several panel estimations. Linkages between value added (VA) and environmental indicators are significantly positive only for the direct material consumption. For SO2, we find decoupling of VA and emissions. For energy consumption, CO2 and NOx emissions, the empirical estimations do indicate a stable relationship, neither positive nor negative. The results show that these linkages have to be analysed rather at the level of industrial branches than in an economy-wide framework.