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The effects of Internet usage and economic growth on CO2 emissions in OECD countries: A panel investigation

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  • Salahuddin, Mohammad
  • Alam, Khorshed
  • Ozturk, Ilhan

Abstract

This paper estimates the short- and long-run effects of Internet usage and economic growth on carbon dioxide (CO2) emissions using OECD panel data for the period 1991–2012. The Pedroni panel cointegration test confirms that the variables are cointegrated. Although Pooled Mean Group (PMG) estimates indicate a positive significant long-run relationship between Internet usage and CO2 emissions, the coefficient is very small and no causality exists between them, which both imply that the rapid growth in Internet usage is still not an environmental threat for the region. The study further indicates that economic growth has no significant short-run and long-run effects on CO2 emissions. Internet use stimulates both financial development and trade openness. The findings offer support in favor of the argument that OECD countries can promote their Internet usage without being significantly concerned about its environmental consequences. But the future emissions effect of Internet usage cannot be ruled out, as is evident from the variance decomposition analysis. Therefore, this study recommends that in addition to boosting the existing measures for combating CO2 emissions, OECD countries need to use ICT equipment not to simply reduce its own carbon footprint but also to exploit ICT-enabled emissions abatement potential to reduce emissions in other sectors, such as the power, energy, agricultural, transport and service sectors.

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  • Salahuddin, Mohammad & Alam, Khorshed & Ozturk, Ilhan, 2016. "The effects of Internet usage and economic growth on CO2 emissions in OECD countries: A panel investigation," Renewable and Sustainable Energy Reviews, Elsevier, vol. 62(C), pages 1226-1235.
  • Handle: RePEc:eee:rensus:v:62:y:2016:i:c:p:1226-1235
    DOI: 10.1016/j.rser.2016.04.018
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    2. Kouton, Jeffrey, 2019. "Information Communication Technology development and energy demand in African countries," Energy, Elsevier, vol. 189(C).
    3. Fortune Ganda & Khazamula Samson Milondzo, 2018. "The Impact of Carbon Emissions on Corporate Financial Performance: Evidence from the South African Firms," Sustainability, MDPI, Open Access Journal, vol. 10(7), pages 1-22, July.
    4. Park, Sungjun & Kim, Jinsoo, 2018. "The effect of interest in renewable energy on US household electricity consumption: An analysis using Google Trends data," Renewable Energy, Elsevier, vol. 127(C), pages 1004-1010.
    5. Ibrahim D. Raheem & Aviral K. Tiwari & Daniel Balsalobre-lorente, 2019. "The Role of ICT and Financial Development on CO2 Emissions and Economic Growth," Working Papers 19/058, European Xtramile Centre of African Studies (EXCAS).
    6. Hongze Li & Fengyun Li & Di Shi & Xinhua Yu & Jianfei Shen, 2018. "Carbon Emission Intensity, Economic Development and Energy Factors in 19 G20 Countries: Empirical Analysis Based on a Heterogeneous Panel from 1990 to 2015," Sustainability, MDPI, Open Access Journal, vol. 10(7), pages 1-26, July.
    7. Hongzhong Fan & Md Ismail Hossain & Mollah Aminul Islam & Yassin Elshain Yahia, 2019. "The Impact of Trade, Technology and Growth on Environmental Deterioration of China and India," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 9(1), pages 1-29, January.
    8. Yang, Xuechun & Lou, Feng & Sun, Mingxing & Wang, Renqing & Wang, Yutao, 2017. "Study of the relationship between greenhouse gas emissions and the economic growth of Russia based on the Environmental Kuznets Curve," Applied Energy, Elsevier, vol. 193(C), pages 162-173.
    9. Gnangnon, Sèna Kimm & Brun, Jean-François, 2018. "Impact of bridging the Internet gap on public revenue mobilization," Information Economics and Policy, Elsevier, vol. 43(C), pages 23-33.
    10. Wenyan Wang & Juan Wang & Fang Guo, 2018. "Carbon Dioxide (CO 2 ) Emission Reduction Potential in East and South Coastal China: Scenario Analysis Based on STIRPAT," Sustainability, MDPI, Open Access Journal, vol. 10(6), pages 1-18, June.

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    Keywords

    CO2 emissions; Internet usage; OECD countries; Economic growth;

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