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New evidence on the convergence of per capita carbon dioxide emissions from panel seemingly unrelated regressions augmented Dickey–Fuller tests

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  • Lee, Chien-Chiang
  • Chang, Chun-Ping

Abstract

Using the data for per capita carbon dioxide (CO2) emissions relative to the average per capita emissions for 21 countries in the organisation for economic co-operation and development (OECD) covering the period 1960–2000, this paper seeks to determine whether the stochastic convergence and β-convergence of CO2 emissions are supported in countries with the same level of development. In other words, are shocks to relative per capita CO2 emissions temporary in industrialized countries? We respond to this question by utilizing Breuer et al.'s [Breuer JB, McNown R, Wallace MS. Misleading inferences from panel unit-root tests with an illustration from purchasing power parity. Review of International Economics 2001;9(3):482–93; Breuer JB, McNown R, Wallace MS. Series-specific unit-root tests with panel data. Oxford Bulletin of Economics and Statistics 2002 64(5):527–46] panel seemingly unrelated regressions augmented Dickey–Fuller (SURADF) unit-root tests, which allow us to account for possible cross-sectional effects and to identify how many and which members of the panel contain a unit root. Our empirical findings provide evidence that relative per capita CO2 emissions in OECD countries are a mixture of I(0) and I(1) processes, in which 14 out of 21 OECD countries exhibit divergence. The results reveal that conventional panel unit-root tests can lead to misleading inferences biased towards stationarity even if only one series in the panel is strongly stationary.

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  • Lee, Chien-Chiang & Chang, Chun-Ping, 2008. "New evidence on the convergence of per capita carbon dioxide emissions from panel seemingly unrelated regressions augmented Dickey–Fuller tests," Energy, Elsevier, vol. 33(9), pages 1468-1475.
  • Handle: RePEc:eee:energy:v:33:y:2008:i:9:p:1468-1475
    DOI: 10.1016/j.energy.2008.05.002
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    2. Mishra, Vinod & Smyth, Russell, 2017. "Conditional convergence in Australia's energy consumption at the sector level," Energy Economics, Elsevier, vol. 62(C), pages 396-403.
    3. Mishra, Vinod & Smyth, Russell, 2014. "Convergence in energy consumption per capita among ASEAN countries," Energy Policy, Elsevier, vol. 73(C), pages 180-185.
    4. Tuck Cheong Tang & Evan Lau, 2008. "An Empirical Investigation On The Sustainability Of Balancing Item Of Balance Of Payment Accounts For Oic Member Countries," Monash Economics Working Papers 31/08, Monash University, Department of Economics.
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    10. Payne, James E. & Vizek, Maruška & Lee, Junsoo, 2017. "Stochastic convergence in per capita fossil fuel consumption in U.S. states," Energy Economics, Elsevier, vol. 62(C), pages 382-395.
    11. Jobert, Thomas & Karanfil, Fatih & Tykhonenko, Anna, 2010. "Convergence of per capita carbon dioxide emissions in the EU: Legend or reality?," Energy Economics, Elsevier, vol. 32(6), pages 1364-1373, November.
    12. Payne, James E. & Vizek, Maruška & Lee, Junsoo, 2017. "Is there convergence in per capita renewable energy consumption across U.S. States? Evidence from LM and RALS-LM unit root tests with breaks," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 715-728.
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    15. repec:eee:eneeco:v:70:y:2018:i:c:p:563-581 is not listed on IDEAS
    16. Yuan, Jiahai & Xu, Yan & Hu, Zheng & Zhao, Changhong & Xiong, Minpeng & Guo, Jingsheng, 2014. "Peak energy consumption and CO2 emissions in China," Energy Policy, Elsevier, vol. 68(C), pages 508-523.
    17. Nilgun Yavuz & Veli Yilanci, 2013. "Convergence in Per Capita Carbon Dioxide Emissions Among G7 Countries: A TAR Panel Unit Root Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 54(2), pages 283-291, February.
    18. Herrerias, M.J. & Liu, G., 2013. "Electricity intensity across Chinese provinces: New evidence on convergence and threshold effects," Energy Economics, Elsevier, vol. 36(C), pages 268-276.
    19. Wang, Juan & Zhang, Kezhong, 2014. "Convergence of carbon dioxide emissions in different sectors in China," Energy, Elsevier, vol. 65(C), pages 605-611.
    20. Yanan Chen & Sheng Lin, 2015. "Study on factors affecting energy-related per capita carbon dioxide emission by multi-sectoral of cities: a case study of Tianjin," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 77(2), pages 833-846, June.
    21. Muhammad Zeshan & Vaqar Ahmed, 2013. "Energy, environment and growth nexus in South Asia," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 15(6), pages 1465-1475, December.
    22. Meng, Ming & Payne, James E. & Lee, Junsoo, 2013. "Convergence in per capita energy use among OECD countries," Energy Economics, Elsevier, vol. 36(C), pages 536-545.
    23. Fernández-Amador, Octavio & Oberdabernig, Doris & Tomberger, Patrick, 2017. "Testing for Convergence in Carbon Dioxide Emissions using a Bayesian Robust Structural Model," Papers 1101, World Trade Institute.
    24. Mariam Camarero & Yurena Mendoza & Javier Ordóñez, 2011. "Re-examining CO2 emissions. Is the assessment of convergence meaningless?," Working Papers 2011/06, Economics Department, Universitat Jaume I, Castellón (Spain).
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