IDEAS home Printed from https://ideas.repec.org/a/spr/envsyd/v38y2018i3d10.1007_s10669-018-9671-z.html
   My bibliography  Save this article

The decline of environmental degradation by renewable energy consumption in the MERCOSUR countries: an approach with ARDL modeling

Author

Listed:
  • Matheus Koengkan

    (Federal Fluminense University)

Abstract

The impact of consumption of renewable energy on CO2 emissions was investigated, in five MERCOSUR’s countries from 1980 to 2014. The autoregressive distributed lag (ARDL) in the form of Unrestricted Error Correction Model to decompose the total effect of variables into it is the short- and long-run components. The results of preliminary tests showed the presence of cross-sectional dependence between the variables, the stationarity of all variables in the first differences, and the homogeneity in panel data. Moreover, the specification tests pointed to the presence of cross-sectional dependence, non-correlation between the crosses, serial correlation in the panel data model, and the existence of heteroskedasticity. The results of semi-elasticities (short run) and elasticities (long run) of ARDL model pointed that the economic growth and consumption of fossil fuels increase the CO2 emissions in the short and long run, while the consumption of renewable energy reduces them. Despite the consumption of renewable energy reducing the environmental degradation in the MERCOSUR countries, its impact is small. Finally, this study proved that the consumption of renewable energy is able to reduce the CO2 emissions, which is responsible for the environmental degradation in the MERCOSUR countries, and that the economic growth of these same countries increases the CO2 emissions, along with the fact that all MERCOSUR countries are highly dependent of fossil fuels.

Suggested Citation

  • Matheus Koengkan, 2018. "The decline of environmental degradation by renewable energy consumption in the MERCOSUR countries: an approach with ARDL modeling," Environment Systems and Decisions, Springer, vol. 38(3), pages 415-425, September.
    • Handle: RePEc:spr:envsyd:v:38:y:2018:i:3:d:10.1007_s10669-018-9671-z
    DOI: 10.1007/s10669-018-9671-z
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10669-018-9671-z
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10669-018-9671-z?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Abdeen Mustafa Omer, 2002. "Energy Supply Potentials and Needs, and the Environmental Impact of their Use in Sudan," Environment Systems and Decisions, Springer, vol. 22(4), pages 353-365, December.
    2. Charfeddine, Lanouar, 2017. "The impact of energy consumption and economic development on Ecological Footprint and CO2 emissions: Evidence from a Markov Switching Equilibrium Correction Model," Energy Economics, Elsevier, vol. 65(C), pages 355-374.
    3. Joakim Westerlund, 2007. "Testing for Error Correction in Panel Data," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 69(6), pages 709-748, December.
    4. Shahzad, Syed Jawad Hussain & Kumar, Ronald Ravinesh & Zakaria, Muhammad & Hurr, Maryam, 2017. "Carbon emission, energy consumption, trade openness and financial development in Pakistan: A revisit," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 185-192.
    5. T. S. Breusch & A. R. Pagan, 1980. "The Lagrange Multiplier Test and its Applications to Model Specification in Econometrics," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 47(1), pages 239-253.
    6. Aliprandi, F. & Stoppato, A. & Mirandola, A., 2016. "Estimating CO2 emissions reduction from renewable energy use in Italy," Renewable Energy, Elsevier, vol. 96(PA), pages 220-232.
    7. M. Hashem Pesaran, 2021. "General diagnostic tests for cross-sectional dependence in panels," Empirical Economics, Springer, vol. 60(1), pages 13-50, January.
    8. Bélaïd, Fateh & Youssef, Meriem, 2017. "Environmental degradation, renewable and non-renewable electricity consumption, and economic growth: Assessing the evidence from Algeria," Energy Policy, Elsevier, vol. 102(C), pages 277-287.
    9. Omri, Anis & Nguyen, Duc Khuong & Rault, Christophe, 2014. "Causal interactions between CO2 emissions, FDI, and economic growth: Evidence from dynamic simultaneous-equation models," Economic Modelling, Elsevier, vol. 42(C), pages 382-389.
    10. Menyah, Kojo & Wolde-Rufael, Yemane, 2010. "Energy consumption, pollutant emissions and economic growth in South Africa," Energy Economics, Elsevier, vol. 32(6), pages 1374-1382, November.
    11. Al-mulali, Usama & Tang, Chor Foon & Ozturk, Ilhan, 2015. "Estimating the Environment Kuznets Curve hypothesis: Evidence from Latin America and the Caribbean countries," Renewable and Sustainable Energy Reviews, Elsevier, vol. 50(C), pages 918-924.
    12. Ito, Katsuya, 2017. "CO2 emissions, renewable and non-renewable energy consumption, and economic growth: Evidence from panel data for developing countries," International Economics, Elsevier, vol. 151(C), pages 1-6.
    13. Mishkin, Frederic S., 1999. "Lessons from the Tequila Crisis," Journal of Banking & Finance, Elsevier, vol. 23(10), pages 1521-1533, October.
    14. Bilgili, Faik & Koçak, Emrah & Bulut, Ümit, 2016. "The dynamic impact of renewable energy consumption on CO2 emissions: A revisited Environmental Kuznets Curve approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 54(C), pages 838-845.
    15. Walter Vergara & Ana R. Rios & Luis Miguel Galindo Paliza & Pablo Gutman & Paul Isbell & Paul Hugo Suding & Joseluis Samaniego, 2013. "The Climate and Development Challenge for Latin America and the Caribbean: Options for Climate-Resilient, Low-Carbon Development," IDB Publications (Books), Inter-American Development Bank, number 80518, February.
    16. Maddala, G S & Wu, Shaowen, 1999. "A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 631-652, Special I.
    17. Salim, Ruhul A. & Shafiei, Sahar, 2014. "Urbanization and renewable and non-renewable energy consumption in OECD countries: An empirical analysis," Economic Modelling, Elsevier, vol. 38(C), pages 581-591.
    18. Jaforullah, Mohammad & King, Alan, 2015. "Does the use of renewable energy sources mitigate CO2 emissions? A reassessment of the US evidence," Energy Economics, Elsevier, vol. 49(C), pages 711-717.
    19. Saidi Kais & Ben Mbarek Mounir, 2017. "Causal interactions between environmental degradation, renewable energy, nuclear energy and real GDP: a dynamic panel data approach," Environment Systems and Decisions, Springer, vol. 37(1), pages 51-67, March.
    20. Alvarez-Herranz, Agustin & Balsalobre-Lorente, Daniel & Shahbaz, Muhammad & Cantos, José María, 2017. "Energy innovation and renewable energy consumption in the correction of air pollution levels," Energy Policy, Elsevier, vol. 105(C), pages 386-397.
    21. Wesseh, Presley K. & Lin, Boqiang, 2016. "Can African countries efficiently build their economies on renewable energy?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 54(C), pages 161-173.
    22. Menyah, Kojo & Wolde-Rufael, Yemane, 2010. "CO2 emissions, nuclear energy, renewable energy and economic growth in the US," Energy Policy, Elsevier, vol. 38(6), pages 2911-2915, June.
    23. repec:ipg:wpaper:2014-542 is not listed on IDEAS
    24. Özbuğday, Fatih Cemil & Erbas, Bahar Celikkol, 2015. "How effective are energy efficiency and renewable energy in curbing CO2 emissions in the long run? A heterogeneous panel data analysis," Energy, Elsevier, vol. 82(C), pages 734-745.
    25. Qi, Tianyu & Zhang, Xiliang & Karplus, Valerie J., 2014. "The energy and CO2 emissions impact of renewable energy development in China," Energy Policy, Elsevier, vol. 68(C), pages 60-69.
    26. Katsuya Ito, 2017. "CO2 emissions, renewable and non-renewable energy consumption, and economic growth: Evidence from panel data for developing countries," International Economics, CEPII research center, issue 151, pages 1-6.
    27. repec:idb:brikps:456 is not listed on IDEAS
    28. G. S. Maddala & Shaowen Wu, 1999. "A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(S1), pages 631-652, November.
    29. Shafiei, Sahar & Salim, Ruhul A., 2014. "Non-renewable and renewable energy consumption and CO2 emissions in OECD countries: A comparative analysis," Energy Policy, Elsevier, vol. 66(C), pages 547-556.
    30. Budzianowski, Wojciech M. & Postawa, Karol, 2017. "Renewable energy from biogas with reduced carbon dioxide footprint: Implications of applying different plant configurations and operating pressures," Renewable and Sustainable Energy Reviews, Elsevier, vol. 68(P2), pages 852-868.
    31. Apergis, Nicholas & Payne, James E. & Menyah, Kojo & Wolde-Rufael, Yemane, 2010. "On the causal dynamics between emissions, nuclear energy, renewable energy, and economic growth," Ecological Economics, Elsevier, vol. 69(11), pages 2255-2260, September.
    32. Pao, Hsiao-Tien & Tsai, Chung-Ming, 2011. "Multivariate Granger causality between CO2 emissions, energy consumption, FDI (foreign direct investment) and GDP (gross domestic product): Evidence from a panel of BRIC (Brazil, Russian Federation, I," Energy, Elsevier, vol. 36(1), pages 685-693.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Fotio, Herve Kaffo & Nchofoung, Tii N. & Asongu, Simplice A., 2022. "Financing renewable energy generation in SSA: Does financial integration matter?," Renewable Energy, Elsevier, vol. 201(P2), pages 47-59.
    2. Matheus Koengkan & Renato Santiago & José Alberto Fuinhas & António Cardoso Marques, 2019. "Does financial openness cause the intensification of environmental degradation? New evidence from Latin American and Caribbean countries," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 21(4), pages 507-532, October.
    3. Matheus Koengkan & José Alberto Fuinhas & Renato Santiago, 2020. "Asymmetric impacts of globalisation on CO2 emissions of countries in Latin America and the Caribbean," Environment Systems and Decisions, Springer, vol. 40(1), pages 135-147, March.
    4. Hanif, Imran & Faraz Raza, Syed Muhammad & Gago-de-Santos, Pilar & Abbas, Qaiser, 2019. "Fossil fuels, foreign direct investment, and economic growth have triggered CO2 emissions in emerging Asian economies: Some empirical evidence," Energy, Elsevier, vol. 171(C), pages 493-501.
    5. Ahsan Anwar & Avik Sinha & Arshian Sharif & Muhammad Siddique & Shoaib Irshad & Waseem Anwar & Summaira Malik, 2022. "The nexus between urbanization, renewable energy consumption, financial development, and CO2 emissions: evidence from selected Asian countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(5), pages 6556-6576, May.
    6. Chien, Fengsheng & Ajaz, Tahseen & Andlib, Zubaria & Chau, Ka Yin & Ahmad, Paiman & Sharif, Arshian, 2021. "The role of technology innovation, renewable energy and globalization in reducing environmental degradation in Pakistan: A step towards sustainable environment," Renewable Energy, Elsevier, vol. 177(C), pages 308-317.
    7. Ramesh Chandra Das & Tonmoy Chatterjee & Enrico Ivaldi, 2022. "Nexus between Housing Price and Magnitude of Pollution: Evidence from the Panel of Some High- and-Low Polluting Cities of the World," Sustainability, MDPI, vol. 14(15), pages 1-18, July.
    8. Selim J rgen Ergun & Maria Fernanda Rivas, 2020. "Testing the Environmental Kuznets Curve Hypothesis in Uruguay using Ecological Footprint as a Measure of Environmental Degradation," International Journal of Energy Economics and Policy, Econjournals, vol. 10(4), pages 473-485.
    9. Consolación Quintana-Rojo & Fernando-Evaristo Callejas-Albiñana & Miguel-Ángel Tarancón & Isabel Martínez-Rodríguez, 2020. "Econometric Studies on the Development of Renewable Energy Sources to Support the European Union 2020–2030 Climate and Energy Framework: A Critical Appraisal," Sustainability, MDPI, vol. 12(12), pages 1-26, June.
    10. Matheus Koengkan & José Alberto Fuinhas & Isabel Vieira, 2021. "Measuring the effect of trade liberalisation on the consumption of non-renewable energy sources in Latin America&the Caribbean Countries," Economics and Business Letters, Oviedo University Press, vol. 10(4), pages 349-358.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dong, Kangyin & Hochman, Gal & Zhang, Yaqing & Sun, Renjin & Li, Hui & Liao, Hua, 2018. "CO2 emissions, economic and population growth, and renewable energy: Empirical evidence across regions," Energy Economics, Elsevier, vol. 75(C), pages 180-192.
    2. Charfeddine, Lanouar & Kahia, Montassar, 2019. "Impact of renewable energy consumption and financial development on CO2 emissions and economic growth in the MENA region: A panel vector autoregressive (PVAR) analysis," Renewable Energy, Elsevier, vol. 139(C), pages 198-213.
    3. Usman, Muhammad & Makhdum, Muhammad Sohail Amjad, 2021. "What abates ecological footprint in BRICS-T region? Exploring the influence of renewable energy, non-renewable energy, agriculture, forest area and financial development," Renewable Energy, Elsevier, vol. 179(C), pages 12-28.
    4. Lau, Lin-Sea & Choong, Chee-Keong & Ng, Cheong-Fatt & Liew, Feng-Mei & Ching, Suet-Ling, 2019. "Is nuclear energy clean? Revisit of Environmental Kuznets Curve hypothesis in OECD countries," Economic Modelling, Elsevier, vol. 77(C), pages 12-20.
    5. Suyi Kim, 2020. "The Effects of Foreign Direct Investment, Economic Growth, Industrial Structure, Renewable and Nuclear Energy, and Urbanization on Korean Greenhouse Gas Emissions," Sustainability, MDPI, vol. 12(4), pages 1-14, February.
    6. Fateh Belaïd & Maha Harbaoui Zrelli, 2016. "Renewable and Non-Renewable Electricity Consumption, Carbon Emissions and GDP: Evidence From Mediterranean Countries," Working Papers 1037, Economic Research Forum, revised Aug 2016.
    7. Belaïd, Fateh & Zrelli, Maha Harbaoui, 2019. "Renewable and non-renewable electricity consumption, environmental degradation and economic development: Evidence from Mediterranean countries," Energy Policy, Elsevier, vol. 133(C).
    8. Kangyin Dong & Xiucheng Dong & Qingzhe Jiang, 2020. "How renewable energy consumption lower global CO2 emissions? Evidence from countries with different income levels," The World Economy, Wiley Blackwell, vol. 43(6), pages 1665-1698, June.
    9. Zoundi, Zakaria, 2017. "CO2 emissions, renewable energy and the Environmental Kuznets Curve, a panel cointegration approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 72(C), pages 1067-1075.
    10. Suyi Kim, 2022. "The Effects of Information and Communication Technology, Economic Growth, Trade Openness, and Renewable Energy on CO 2 Emissions in OECD Countries," Energies, MDPI, vol. 15(7), pages 1-15, March.
    11. Azam, Anam & Rafiq, Muhammad & Shafique, Muhammad & Zhang, Haonan & Yuan, Jiahai, 2021. "Analyzing the effect of natural gas, nuclear energy and renewable energy on GDP and carbon emissions: A multi-variate panel data analysis," Energy, Elsevier, vol. 219(C).
    12. Jiang-Long Liu & Chao-Qun Ma & Yi-Shuai Ren & Xin-Wei Zhao, 2020. "Do Real Output and Renewable Energy Consumption Affect CO 2 Emissions? Evidence for Selected BRICS Countries," Energies, MDPI, vol. 13(4), pages 1-18, February.
    13. Magazzino, Cosimo & Mele, Marco & Schneider, Nicolas, 2021. "A machine learning approach on the relationship among solar and wind energy production, coal consumption, GDP, and CO2 emissions," Renewable Energy, Elsevier, vol. 167(C), pages 99-115.
    14. Mumin Atalay Cetin & Ibrahim Bakirtas, 2020. "The long-run environmental impacts of economic growth, financial development, and energy consumption: Evidence from emerging markets," Energy & Environment, , vol. 31(4), pages 634-655, June.
    15. Liobikienė, Genovaitė & Butkus, Mindaugas, 2019. "Scale, composition, and technique effects through which the economic growth, foreign direct investment, urbanization, and trade affect greenhouse gas emissions," Renewable Energy, Elsevier, vol. 132(C), pages 1310-1322.
    16. Ahsan Anwar & Avik Sinha & Arshian Sharif & Muhammad Siddique & Shoaib Irshad & Waseem Anwar & Summaira Malik, 2022. "The nexus between urbanization, renewable energy consumption, financial development, and CO2 emissions: evidence from selected Asian countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(5), pages 6556-6576, May.
    17. Adewuyi, Adeolu O. & Awodumi, Olabanji B., 2017. "Renewable and non-renewable energy-growth-emissions linkages: Review of emerging trends with policy implications," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 275-291.
    18. Chen, Chaoyi & Pinar, Mehmet & Stengos, Thanasis, 2022. "Renewable energy and CO2 emissions: New evidence with the panel threshold model," Renewable Energy, Elsevier, vol. 194(C), pages 117-128.
    19. Chen, Chaoyi & Pinar, Mehmet & Stengos, Thanasis, 2020. "Renewable energy consumption and economic growth nexus: Evidence from a threshold model," Energy Policy, Elsevier, vol. 139(C).
    20. Vural, Gulfer, 2020. "How do output, trade, renewable energy and non-renewable energy impact carbon emissions in selected Sub-Saharan African Countries?," Resources Policy, Elsevier, vol. 69(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:envsyd:v:38:y:2018:i:3:d:10.1007_s10669-018-9671-z. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.