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Relationships among CO2 Emissions, Economic Growth and Foreign Direct Investment and the Environmental Kuznets Curve Hypothesis in Turkey

Listed author(s):
  • Mesut Balýbey

    (Faculty of Economics and Administrative Sciences, Tunceli University, Tunceli, Turkey.)

Registered author(s):

    This study examines the causal relationships between economic growth, carbon dioxide emission and foreign direct investment (FDI) and evaluates the environmental kuznets curve (EKC) hypothesis for Turkey in 1974-2011. Firstly, the causality relationships investigated by using the Johansen Cointegration test, The Granger Causality Test, Impulse-Response and Variance Decomposition Analysis of vector autoregression model (VAR) model. The causality relationships display that FDI (LFDI) and economic growth (LGDP) have a significant effect on carbon dioxide emissions (LCO2). Moreover, impulse-response functions and variance-decompositions of VAR model support these relationships among LGDP, LCO2 and LFDI. Secondly, the study investigates the validity of the EKC hypothesis in Turkey for the period 1974-2011 by using regression model approach for the various EKC model forms such as linear, quadratic, and cubic. Consequently, economic growth leads to degradation of environment and depletion of natural resources. It must be the major aim to obtain a sustainable economic growth by less CO2 emissions and consuming less energy. Moreover, the policy makers may take account exogenous impacts such as foreign investments to plan energy policies, and to maintain economic growth against global climate warming.

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    File URL: http://www.econjournals.com/index.php/ijeep/article/download/1462/906
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    Article provided by Econjournals in its journal International Journal of Energy Economics and Policy.

    Volume (Year): 5 (2015)
    Issue (Month): 4 ()
    Pages: 1042-1049

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    Handle: RePEc:eco:journ2:2015-04-16
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    1. Halicioglu, Ferda, 2009. "An econometric study of CO2 emissions, energy consumption, income and foreign trade in Turkey," Energy Policy, Elsevier, vol. 37(3), pages 1156-1164, March.
    2. Grossman, G.M & Krueger, A.B., 1991. "Environmental Impacts of a North American Free Trade Agreement," Papers 158, Princeton, Woodrow Wilson School - Public and International Affairs.
    3. Sahbi Farhani & Jaleleddine Ben Rejeb, 2012. "Energy Consumption, Economic Growth and CO2 Emissions: Evidence from Panel Data for MENA Region," International Journal of Energy Economics and Policy, Econjournals, vol. 2(2), pages 71-81.
    4. Kim, Sei-wan & Lee, Kihoon & Nam, Kiseok, 2010. "The relationship between CO2 emissions and economic growth: The case of Korea with nonlinear evidence," Energy Policy, Elsevier, vol. 38(10), pages 5938-5946, October.
    5. Choi, Eunho & Heshmati, Almas & Cho, Yongsung, 2010. "An Empirical Study of the Relationships between CO2 Emissions, Economic Growth and Openness," IZA Discussion Papers 5304, Institute for the Study of Labor (IZA).
    6. Dinda, Soumyananda, 2004. "Environmental Kuznets Curve Hypothesis: A Survey," Ecological Economics, Elsevier, vol. 49(4), pages 431-455, August.
    7. Kaplan, Muhittin & Ozturk, Ilhan & Kalyoncu, Huseyin, 2011. "Energy Consumption and Economic Growth in Turkey: Cointegration and Causality Analysis," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 31-41, June.
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