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Club convergence and clustering of U.S. energy-related CO2 emissions

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  • Burnett, J. Wesley

Abstract

This study examines the convergence of energy-related carbon dioxide emissions among a panel of U.S. states between the period 1960–2010. This examination is carried out by means of a two-stage procedure. In the first stage, we conduct an endogenous grouping, regression-based convergence test. Unlike previous studies, this methodology endogenously identifies groups of states with emissions that are converging to a similar steady state growth path over time. In the second stage, we evaluate the conditional rate of convergence for the whole sample and for each club using panel data, fixed effects models that control for unobserved, time-invariant heterogeneous effects. More specifically, we examine the rates of convergence conditional on certain structural and non-structural characteristics of the state economy. Results from stage one and stage two suggest that one group of twenty-six states is converging to a unique steady-state equilibrium, and otherwise, the remaining states are diverging. Finally, we discuss different policy approaches to mitigating carbon dioxide emissions based on the club convergence hypothesis.

Suggested Citation

  • Burnett, J. Wesley, 2016. "Club convergence and clustering of U.S. energy-related CO2 emissions," Resource and Energy Economics, Elsevier, vol. 46(C), pages 62-84.
  • Handle: RePEc:eee:resene:v:46:y:2016:i:c:p:62-84
    DOI: 10.1016/j.reseneeco.2016.09.001
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    Cited by:

    1. Brännlund, Runar & Lundgren, Tommy & Söderholm, Patrik, 2015. "Convergence of carbon dioxide performance across Swedish industrial sectors: An environmental index approach," Energy Economics, Elsevier, vol. 51(C), pages 227-235.
    2. repec:eee:eneeco:v:63:y:2017:i:c:p:365-372 is not listed on IDEAS
    3. repec:bla:jageco:v:68:y:2017:i:1:p:206-227 is not listed on IDEAS
    4. repec:eee:enepol:v:109:y:2017:i:c:p:499-509 is not listed on IDEAS
    5. Sebestyénné Szép, Tekla, 2016. "Energetikai konvergencia az Energia 2020 stratégia tükrében. A konvergenciaszámítások alkalmazásának egy alternatív lehetősége
      [Energy convergence in the light of the Energy 2020 strategy. An alter
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(5), pages 564-587.
    6. 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.

    More about this item

    Keywords

    Carbon dioxide emissions; Club convergence; Climate change policies;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • Q47 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy Forecasting
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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