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Trade and Environment Nexus in Saudi Arabia: An Environmental Kuznets Curve Hypothesis

Author

Listed:
  • Haider Mahmood

    (Department of Finance, College of Business Administration, Prince Sattam Bin Abdulaziz University, Alkharj, Saudi Arabia,)

  • Tarek Tawfik Yousef Alkhateeb

    (Department of Marketing, College of Business Administration, Prince Sattam Bin Abdulaziz University, Alkharj, Saudi Arabia and Kafr Elsheikh University, Egypt)

Abstract

This research explores the effects of trade and income level on the Carbon Dioxide Emissions (CDE) in Saudi Arabia by using a period 1970-2016. Unit root and cointegration tests have been utilized for data analysis. Unit root test confirms the level of integration as one and cointegration has been found in our estimated model through bound testing procedure. In the long run, income is found responsible for increasing CDE but its square term is showing a negative impact on CDE. Therefore, this study has inveterate the presence of Environmental Kuznets Curve (EKC) hypothesis. Further, trade has negative impact on CDE. Therefore, trade has been remained helpful in reducing pollution levels in Saudi Arabia. The income, its square and trade have same directions of relationships in short run as in long run. Based on findings, this study recommends the Saudi government to liberalize trade policy to protect environment.

Suggested Citation

  • Haider Mahmood & Tarek Tawfik Yousef Alkhateeb, 2017. "Trade and Environment Nexus in Saudi Arabia: An Environmental Kuznets Curve Hypothesis," International Journal of Energy Economics and Policy, Econjournals, vol. 7(5), pages 291-295.
    • Handle: RePEc:eco:journ2:2017-05-32
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    References listed on IDEAS

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    More about this item

    Keywords

    Carbon Dioxide Emissions; Trade; Environmental Kuznets Curve;
    All these keywords.

    JEL classification:

    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • O49 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Other
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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