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The Environmental Kuznets Curve at Different Levels of Economic Development: A Counterfactual Quantile Regression Analysis for CO2 Emissions

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  • Natina Yaduma
  • Mika Kortelainen
  • Ada Wossink

Abstract

This paper applies the quantile fixed effects technique in exploring the CO 2 environmental Kuznets curve within two groups of economic development (OECD and non-OECD countries) and six geographical regions - West, East Europe, Latin America, East Asia, West Asia and Africa. A comparison of the findings resulting from the use of this technique with those of conventional fixed effects method reveals that the latter may depict a flawed summary of the prevailing income-emissions nexus depending on the conditional quantile examined. The paper also extends the Machado and Mata decomposition method to the Kuznets curve framework to explore the most important explanations for CO 2 emissions gap between OECD and non-OECD countries. We find a statistically significant OECD--non-OECD emissions gap and the decomposition reveals that there are non-income related factors working against the non-OECD group's greening. We tentatively conclude that deliberate and systematic mitigation of current CO 2 emissions in the non-OECD group is required.
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Suggested Citation

  • Natina Yaduma & Mika Kortelainen & Ada Wossink, 2013. "The Environmental Kuznets Curve at Different Levels of Economic Development: A Counterfactual Quantile Regression Analysis for CO2 Emissions," The School of Economics Discussion Paper Series 1322, Economics, The University of Manchester.
  • Handle: RePEc:man:sespap:1322
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    File URL: http://hummedia.manchester.ac.uk/schools/soss/economics/discussionpapers/EDP-1322.pdf
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    References listed on IDEAS

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    1. David I. Stern, 2012. "Ecological Economics," Crawford School Research Papers 1203, Crawford School of Public Policy, The Australian National University.
    2. Natina Yaduma & Mika Kortelainen & Ada Wossink, 2013. "Estimating Mortality and Economic Costs of Particulate Air Pollution in Developing Countries: The Case of Nigeria," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 54(3), pages 361-387, March.
    3. Halkos, George E., 2011. "Nonparametric modelling of biodiversity: Determinants of threatened species," Journal of Policy Modeling, Elsevier, vol. 33(4), pages 618-635, July.
    4. Roger Perman & David I. Stern, 2003. "Evidence from panel unit root and cointegration tests that the Environmental Kuznets Curve does not exist," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 47(3), pages 325-347, September.
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    Cited by:

    1. Maralgua Och, 2017. "Empirical Investigation of the Environmental Kuznets Curve Hypothesis for Nitrous Oxide Emissions for Mongolia," International Journal of Energy Economics and Policy, Econjournals, vol. 7(1), pages 117-128.
    2. You, Wan-Hai & Zhu, Hui-Ming & Yu, Keming & Peng, Cheng, 2015. "Democracy, Financial Openness, and Global Carbon Dioxide Emissions: Heterogeneity Across Existing Emission Levels," World Development, Elsevier, vol. 66(C), pages 189-207.

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