The Effect of Energy Consumption and Economic Growth on Co2 Emissions:Evidence from 58 Countries

We investigate the impact of energy consumption, economic growth, urbanization and trade openness on carbon dioxide emissions for a global panel consisting of 58 countries, using dynamic simultaneous-equation panel data models. In this way, we end up with three region panels; namely, European and North Asian countries, Latin America and Caribbean and Middle East, North Africa, and sub-Saharan. The time component of our dataset is 1990-2012 inclusive. Our results indicate that energy consumption has a positive effects on CO2 emissions and statistically significant for the four panel. The GDP per capita has a positive and statistically significant effect on CO2 emissions for the four panel, for the Europe and North Asia countries, and for the Middle Eastern, North Africa, and sub-Saharan. Furthermore our empirical results indicate the presence of an inverted U-shaped curve between CO2 emissions and GDP per capita. Urbanization is found to have a negative and statistically significant impact on CO2 emissions for the global panel. For the Europe and North Asia and for the Middle East, North Africa, and sub-Saharan, the trade openness has a negative and statistically significant effect on the CO2 emissions.