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Μοdeling Environmental Degradation: The Effects of Electricity Consumption, Economic Growth and Globalization

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  • Pavlos Stamatiou

    (Department of Economic Sciences, International Hellenic University, Greece.)

Abstract

This study aims to explore the effects of electricity consumption, economic growth and globalization on CO2 emissions in the case of the top ten electricity consuming countries. The sample used is annual data covering the period 1990-2018. This paper adopts the cross-sections independence and controls the heterogeneity between cross-sections by using the second generation econometric of panel data. More precisely, the CIPS unit root test, Pedroni (1999) cointegration, Westerlund (2007) bootstrap cointegration, and FMOLS and DOLS techniques have been applied. Additionally, the Dumitrescu and Hurlin (2012) panel causality test is used to investigate the causal nexus among the examined variables. The findings of the study support that all variables are integrated in the long run. Electricity consumption and economic growth have a positive and significant effect on CO2 emissions in these countries. On the other hand, globalization has a negative and significant effect on CO2 emissions, implying the improvement of environmental quality. The results also support the Environmental Kuznets Curve (EKC), as well as bidirectional causalities between economic growth and CO2 emissions, between electricity consumption and CO2 emissions, and between economic growth and globalization. Furthermore, unidirectional causalities running from globalization to CO2 emissions, from economic growth to electricity consumption, and from electricity consumption to globalization are found. Policy implications are further discussed.

Suggested Citation

  • Pavlos Stamatiou, 2023. "Μοdeling Environmental Degradation: The Effects of Electricity Consumption, Economic Growth and Globalization," International Journal of Energy Economics and Policy, Econjournals, vol. 13(5), pages 62-72, September.
    • Handle: RePEc:eco:journ2:2023-05-9
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    More about this item

    Keywords

    Envrironmental Degradation; Electricity Consumption; Economic Growth; CO2 Emissions; Globalization; Panel Data;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • 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
    • F60 - International Economics - - Economic Impacts of Globalization - - - General

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