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Environmental Kuznets curves for CO2 : heterogeneity versus homogeneity

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Author Info
Vollebergh, Herman R.J.
Dijkgraag, Elbert
Melenberg, Bertrand (Tilburg University, Center for Economic Research)

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Abstract

We explore the emissions income relationship for CO2 in OECD countries using various modelling strategies. Even for this relatively homogeneous sample, we find that the inverted-U-shaped curve is quite sensitive to the degree of heterogeneity included in the panel estimations. This finding is robust, not only across different model specifications but also across estimation techniques, including the more flexible non-parametric approach. Differences in restrictions applied in panel estimations are therefore responsible for the widely divergent findings for an inverted-U shape for CO2. Our findings suggest that allowing for enough heterogeneity is essential to prevent spurious correlation from reduced-form panel estimations. Moreover, this inverted U for CO2 is likely to exist for many, but not for all, countries.

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Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 25.

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Date of creation: 2005
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Handle: RePEc:dgr:kubcen:200525

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C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data
Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
O50 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - General

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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Ordás Criado, Carlos, 2007. "Temporal and spatial homogeneity in air pollutants panel EKC estimations: Two nonparametric tests applied to Spanish provinces," MPRA Paper 5043, University Library of Munich, Germany. [Downloadable!]
  2. Massimiliano Mazzanti & Antonio Musolesi & Roberto Zoboli, 2006. "A Bayesian Approach to the Estimation of Environmental Kuznets Curves for CO2 Emissions," Working Papers 2006.121, Fondazione Eni Enrico Mattei. [Downloadable!]
  3. Carlos Ordás Criado, 2008. "Temporal and Spatial Homogeneity in Air Pollutants Panel EKC Estimations," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 40(2), pages 265-283, June. [Downloadable!] (restricted)
  4. Massimiliano Mazzanti & Anna Montini & Roberto Zoboli, 2007. "Economic Dynamics, Emission Trends and the EKC Hypothesis New Evidence Using NAMEA and Provincial Panel Data for Italy," Working Papers 2007.24, Fondazione Eni Enrico Mattei. [Downloadable!]
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