Coordinating technological progress and environmental regulation in CO2 mitigation: The optimal levels for OECD countries & emerging economies

As technological progress and environmental regulation are not only important drivers of but also the double-edged swords in mitigation of CO₂ emissions, it is important to figure out their optimal threshold values for CO₂ emissions' reduction. This paper employs the panel smooth transition regression technique to explore these optimal values in the case of OECD countries and emerging economies. The results show that: (1) OECD countries are at a level of excessive technological progress, which will have a rebound effect and increase CO₂ emissions. (2) Emerging economies are under a strict level of environmental regulation, which will lead to serious ‘green paradox’ effects and harm the economic development. Moreover, they have great potential to achieve CO₂ emissions reduction targets through technological progress. (3) Due to the rebound effect, the concentration of environment-related technologies should be shifted from improving energy efficiency to reducing carbon emissions directly such as capture, storage, sequestration or disposal of greenhouse gases. (4) OECD countries should provide low-carbon technical support to emerging economies. In addition, because of the existence of heterogeneity, OECD countries ought to determine their levels of technological progress and environmental regulation according to their own actual conditions.     

Would environmental regulation improve the greenhouse gas benefits of natural gas use? A Chinese case study

Along with rapidly increasing natural gas consumption and carbon dioxide (CO₂) levels and the gradually strengthening environmental regulation, further investigation of the emission-natural gas-environmental regulation nexus in China is particularly useful for mitigating the country's CO₂ emissions. To empirically investigate whether environmental regulation improves the greenhouse gas benefits of natural gas use in China, this study investigates the causal relationships among CO₂ emissions, natural gas consumption, and environmental regulation in China, based on panel data of China's 30 provinces covering 2005–2015. Fully considering the potential cross-sectional dependence, the system general method of moments (SYS-GMM) estimation method is utilized. The empirical results reveal that: (1) Environmental Kuznets curve (EKC) hypothesis for CO₂ emissions is valid in China; (2) environmental regulation will not only directly affect CO₂ emissions, but also indirectly affect CO₂ emissions by influencing the energy consumption structure; (3) environmental regulation cannot significantly improve the greenhouse gas benefits of natural gas use, as environmental regulation in China can indirectly reduce CO₂ emissions by decreasing coal consumption rather than increasing natural gas consumption; and (4) the causality analysis for three regions confirms the existence of significant regional differences. These findings offer several targeted policies for reducing CO₂ emissions and promoting growth in the natural gas industry in China.     

Financial development,environmental quality,trade and economic growth: What causes what in MENA countries

This paper examines the relationship between financial development, CO₂ emissions, trade and economic growth using simultaneous-equation panel data models for a panel of 12 MENA countries over the period 1990–2011. Our results indicate that there is evidence of bidirectional causality between CO₂ emissions and economic growth. Economic growth and trade openness are interrelated i.e., bidirectional causality. Feedback hypothesis is validated between trade openness and financial development. Neutrality hypothesis is identified between CO₂ emissions and financial development. Unidirectional causality running from financial development to economic growth and from trade openness to CO₂ emissions is identified. Our empirical results also verified the existence of environmental Kuznets curve. These empirical insights are of particular interest to policymakers as they help build sound economic policies to sustain economic development and to improve the environmental quality.     

Environment Kuznets curve for CO2 emissions: A cointegration analysis for China

This study examines the long-run relationship between carbon emissions and energy consumption, income and foreign trade in the case of China by employing time series data of 1975–2005. In particular the study aims at testing whether environmental Kuznets curve (EKC) relationship between CO₂ emissions and per capita real GDP holds in the long run or not. Auto regressive distributed lag (ARDL) methodology is employed for empirical analysis. A quadratic relationship between income and CO₂ emission has been found for the sample period, supporting EKC relationship. The results of Granger causality tests indicate one way causality runs through economic growth to CO₂ emissions. The results of this study also indicate that the carbon emissions are mainly determined by income and energy consumption in the long run. Trade has a positive but statistically insignificant impact on CO₂ emissions.     

The analysis of CO2 emission reduction using an ExSS model of Guangdong province in China

This paper studied the CO₂ emission scenarios of Guangdong province in 2020 and divided the CO₂ emission increment and reductions into various departments and driving factors. Based on the Extended Snapshot model, two CO₂ emission scenarios, Business as Usual (BaU) and Counter Measure (CM) scenario were constructed. CM scenario was completed by using reduction technical measures to achieve the reduction emission goal. The results showed that the amount of CO₂ emission is less 189 million tonne in 2020 CM scenario than BaU scenario. By decomposing the emission reduction measures in CM scenario, it showed that the main means to reduce CO₂ emissions were the industrial structure adjustment, the advanced energy efficiency and the power sector structure adjustment, and the emission reduction contribution rates were 36.85%, 34.55% and 21.74%, respectively. The analysis results could be recommended to the government to make the low-carbon development policy and path.     

Economic growth and pollutant emissions in Tunisia: An empirical analysis of the environmental Kuznets curve

This paper investigates the relationship between economic growth and pollutant emissions for a small and open developing country, Tunisia, during the period 1961–2004. The investigation is made on the basis of the environmental Kuznets curve hypothesis, using time series data and cointegration analysis. Carbon dioxide (CO₂) and sulfur dioxide (SO₂) are used as the environmental indicators, and GDP as the economic indicator. Our results show that there is a long-run cointegrating relationship between the per capita emissions of two pollutants and the per capita GDP. An inverted U relationship between SO₂ emissions and GDP has been found, with income turning point approximately equals to $1200 (constant 2000 prices) or to $3700 (in PPP, constant 2000 prices). However, a monotonically increasing relationship with GDP is found more appropriate for CO₂ emissions. Furthermore, the causality results show that the relationship between income and pollution in Tunisia is one of unidirectional causality with income causing environmental changes and not vice versa, both in the short-run and long-run. This implies that an emission reduction policies and more investment in pollution abatement expense will not hurt economic growth. It could be a feasible policy tool for Tunisia to achieve its sustainable growth in the long-run.     

A note on the environmental Kuznets curve for CO2: A pooled mean group approach

This paper investigates whether the environmental Kuznets curve (EKC) hypothesis for CO₂ emissions is satisfied using the panel data of 28 countries by taking nuclear energy into account. Using the pooled mean group (PMG) estimation method, our main results indicate that (1) the impacts of nuclear energy on CO₂ emissions are significantly negative, (2) CO₂ emissions actually increase monotonically within the sample period in all cases: the full sample, OECD countries, and non-OECD countries, and (3) the growth rate in CO₂ emissions with income is decreasing in OECD countries and increasing in non-OECD countries.     

Investigation of the environmental Kuznets curve for carbon emissions in Malaysia: Do foreign direct investment and trade matter?

Environmental degradation has become a central issue of discussion among the economists and environmentalists. In view of Malaysia's position as one of the main contributors to CO₂ emissions in Asia and its status as a fast growing economy, it is vital, therefore, to conduct a study to identify the relationship between economic growth and CO₂ emissions for Malaysia. This study attempts to examine empirically the environmental Kuznets curve hypothesis for Malaysia in the presence of foreign direct investment and trade openness both in the short- and long-run for the period 1970 to 2008.The bounds testing approach and Granger causality methodology are applied to test the interrelationships of the variables. The results of our study indicate that the inverted-U shaped relationship does exist between economic growth and CO₂ emission in both the short- and long-run for Malaysia after controlling for two additional explanatory variables, namely FDI and trade. Importantly, the results of the study also provide some crucial policy recommendations to the policy makers.     

Non-renewable and renewable energy consumption and CO2 emissions in OECD countries: A comparative analysis

This paper attempts to explore the determinants of CO₂ emissions using the STIRPAT model and data from 1980 to 2011 for OECD countries. The empirical results show that non-renewable energy consumption increases CO₂ emissions, whereas renewable energy consumption decreases CO₂ emissions. Further, the results support the existence of an environmental Kuznets curve between urbanisation and CO₂ emissions, implying that at higher levels of urbanisation, the environmental impact decreases. Therefore, the overall evidence suggests that policy makers should focus on urban planning as well as clean energy development to make substantial contributions to both reducing non-renewable energy use and mitigating climate change.     

Situation and measures of China’s CO<Subscript>2</Subscript> emission mitigation after the Paris Agreement

Global response to climate change has entered the phase of full implementation of the Paris Agreement. To control the global temperature rise below 2°C, all countries must make more efforts to reduce emission. China has combined its goal of emission reduction for combating climate change with its domestic sustainable development strategy to promote energy revolution and the transition of economic development to low-carbon patterns. Through reinforcing the commitment and action before 2020, the CO₂ intensity of GDP can decrease by more than 50% by 2020 compared with that of 2005, and the external commitment target of a 40%–45% decrease can be over fulfilled. Currently, under the new economic normal, China further strengthens the policy measure, vigorously saves energy, enhances energy use efficiency and the economic output benefit, and simultaneously develops new and renewable energy and accelerates energy structural decarbonization, so that the annual decrease rate of the CO₂ intensity of GDP keeps a high level of more than 4% and remains increasing. Thus, the decrease rate of the CO₂ intensity of GDP will exceed the GDP growth rate, and then CO₂ emission will peak around 2030. This will promote the fundamental turning of economic development mode, and lay a foundation for the establishment of a sustainable energy system with near-zero emissions and with new and renewable energy as the main body in the second half of this century. China implements the concept of green low-carbon development and accelerates the low carbon transition of energy and economy to achieve win-win results in economic growth and CO₂ emission mitigation, and these policies and actions will also provide experiences for many other developing countries. On the other hand, China will continue to play a positive and constructive leading role in the implementation of the Paris Agreement internationally, and promote the construction of new mechanisms of win-win cooperation, fairness and justice and common development for global climate governance. Moreover, China will make an effort to build a community of common destiny for mankind, promote pragmatic cooperation among countries, especially among developing countries, and take combating climate change as a new development opportunity for jointly moving toward climate-friendly low-carbon economic development path.     

Carbon dioxide,income and energy: Evidence from a non-linear model

This study applies the panel smooth transition regression (PSTR) model to explore the impacts of real income, energy, and investment on the CO₂-income nexus for 99 countries covering the period from 1971 to 2010. We find that in the full sample, as real income rises, CO₂ emissions rapidly increase first, and then their increasing rate starts to slow down, while the environmental Kuznets curve (EKC) hypothesis for CO₂ emissions is supported from the composite results of three income groups. Our results show that decreasing energy usage, improving energy efficiency, and enhancing clean energy usage could effectively ease the impacts of real income on CO₂ emissions. Moreover, countries with different energy trade conditions and income levels have different CO₂-income correlations, indicating that one size does not fit all.     

Bounds testing approach to analyzing the environment Kuznets curve hypothesis with structural beaks: The role of biomass energy consumption in the United States

This paper re-examines the specification of the environmental Kuznets curve (EKC) for the US economy by accounting for the presence of a major renewable energy source and trade openness over the period 1960–2016. Biomass energy consumption and trade openness as well as oil prices are considered as additional determinants of economic growth, and consequentially of CO₂ emissions. The bounds testing approach to cointegration is used to examine the long-run relationship between the variables in the presence of structural breaks. The causal relationship between the variables is investigated by applying the VECM Granger causality test and accommodating structural breaks. The results confirm the presence of cointegration between the variables. Moreover, the relationship between economic growth and CO₂ emissions is not only inverted-U shaped but also N-shaped in the presence of structural breaks and biomass. Biomass energy consumption lowers CO₂ emissions. Exports, imports and trade openness are also environment-friendly. The causality analysis underscores a feedback effect between biomass energy consumption and CO₂ emissions. Economic growth still Granger causes CO₂ emissions in this new setup.     

The role of trade and FDI for CO2 emissions in Turkey: Nonlinear relationships

This paper examines the effects of foreign trade and foreign direct investment (FDI) on CO₂ emissions in Turkey. We consider linear and nonlinear ARDL models and find significant asymmetric effects of exports, imports and FDI on CO₂ emissions per capita. However, FDI has no statistically significant long-run effects. In the long run, decreases in exports reduce CO₂ emissions per capita but increases in exports have no statistically significant effects. Increases in imports push up CO₂ emissions per capita, while decreases in imports have no long-run effects. On the other hand, CO₂ intensity, which measures CO₂ emissions per unit of energy, is not influenced by exports and imports, nor by FDI. Instead, it is affected positively by financial development and urbanization. Also, we find that an environmental Kuznets curve is present for both CO₂ measures so that increases in real GDP per capita have led to reductions in CO₂ emissions for at least the most recent decade, controlling for other confounding factors. Furthermore, the sectoral shares of CO₂ emissions in total CO₂ emissions change asymmetrically with foreign trade for two of four sectors, with export increases leading to lower CO₂ shares and imports having the opposite effect.     

The renewable energy,CO2 emissions,and economic growth: VAR model

This paper provides an empirical analysis of CO₂ emissions and economic growth, renewable energy consumption, and energy consumption over the period 1975–2014 in Germany. This paper uses the autoregressive distributed lag (ARDL) approach of cointegration test and vector error-correction models. The unit root and cointegration tests show that the long-run relationship between CO₂ emissions and its determinants. The empirical results show that the findings do not support the environmental Kuznets curve between real GDP and CO₂ emissions. To estimate the shocks of renewable energy consumptions, the study applies the dynamic test of Impulse Response Function (IRF) under the VAR method. The increasing portion of renewable energy consumption in electricity generation would have no impacts on the environment. However, the hikes of renewable energy sources would incur more cost to electricity producers and shrivel up the growth of economies through the expansionary effect of industry’s consumption and private capital spending in the Germany’s economy.     

Study on China's low carbon development in an Economy–Energy–Electricity–Environment framework

Emissions mitigation is a major challenge for China's sustainable development. We summarize China's successful experiences on energy efficiency in past 30 years as the contributions of Energy Usage Management and Integrated Resource Strategic Planning, which are essential for low-carbon economy. In an Economy–Energy–Electricity–Environment (E4) framework, the paper studies the low-carbon development of China and gives an outlook of China's economy growth, energy–electricity demand, renewable power generation and energy conservation and emissions mitigation until 2030. A business-as-usual scenario is projected as baseline for comparison while low carbon energy and electricity development path is studied. It is defined as low carbon energy/electricity when an economy body manages to realize its potential economic growth fueled by less energy/electricity consumption, which can be characterized by indexes of energy/electricity intensity and emissions per-unit of energy consumption (electricity generation). Results show that, with EUM, China, could save energy by 4.38 billion ton oil equivalences (toes) and reduce CO₂ emission by 16.55 billion tons; with IRSP, China, could save energy by 1.5 Btoes and reduce CO₂ emission by 5.7 Btons, during 2010–2030. To realize the massive potential, China has to reshape its economic structure and rely much on technology innovation in the future.     

Trends in road freight transportation carbon dioxide emissions and policies in China

We adopted the simple average Divisia index approach to explore the impacts of factors on the carbon dioxide (CO₂) emissions from road freight transportation in China from 1985 to 2007. CO₂ emissions were investigated using the following as influencing factors: the emission coefficient, vehicle fuel intensity, working vehicle stock per freight transport operator, market concentration level, freight transportation distance, market share of road freight transportation, ton-kilometer per value added of industry, industrialization level and economic growth. Building on the results, we suggest that economic growth is the most important factor in increasing CO₂ emissions, whereas the ton-kilometer per value added of industry and the market concentration level contribute significantly to decreasing CO₂ emissions. We also discussed some recent important policies concerning factors contained in the decomposition model.     

Corruption,climate and the energy-environment-growth nexus

This paper examines the causal relationships between economic growth, energy consumption and carbon dioxide (CO₂) emissions in high-income and upper-middle-income countries using the simultaneous equations framework, with data from 1985 to 2011. By taking institutional quality (measured by the level of corruption) and climate (measured by average temperatures over the winter and summer months) into account, this is the first study to incorporate both of these factors into a simultaneous equations model within the energy-environment-growth nexus. The dependent variables in the system of three simultaneous equations are real gross domestic product (GDP), energy consumption and CO₂ emissions as a proxy for air pollution. The results have two important implications. First, they document a bidirectional causal relationship between GDP and energy consumption but do not provide support for the environmental Kuznets curve (EKC) hypothesis. This is revolutionary in the sense that it indicates that high-income and upper-middle-income countries base their economic growth on a feedback relationship with energy consumption and that the ensuing pollution has not yet reached a maximum point, even in these countries. Second, by implying that climate and weather variations are more important determinants of energy consumption and CO₂ emissions than corruption, the results suggest that changes in institutional quality are likely to have only a limited impact on energy and environmental policies.     

Energy efficiency and CO2 emissions in Swedish manufacturing industries

This paper analyses the trends in energy consumption and CO₂ emissions as a result of energy efficiency improvements in Swedish manufacturing industries between 1993 and 2008. Using data at the two-digit level, the performance of this sector is studied in terms of CO₂ emissions, energy consumption, energy efficiency measured as energy intensity, value of production, fuel sources, energy prices and energy taxes. It was found that energy consumption, energy intensity and CO₂ emission intensity, measured as production values, have decreased significantly in the Swedish manufacturing industries during the period studied. The results of the decomposition analysis show that output growth has not required higher energy consumption, leading to a reduction in both energy and CO₂ emission intensities. The role of structural changes has been minor, and the trends of energy efficiency and CO₂ emissions have been similar during the sample period. A stochastic frontier model was used to determine possible factors that may have influenced these trends. The results demonstrate that high energy prices, energy taxes, investments and electricity consumption have influenced the reduction of energy and CO₂ emission intensities, indicating that Sweden has applied an adequate and effective energy policy. The study confirms that it is possible to achieve economic growth and sustainable development whilst also reducing the pressure on resources and energy consumption and promoting the shift towards a low-carbon economy.     

How does the new-type urbanisation affect CO2 emissions in China? An empirical analysis from the perspective of technological progress

The development of traditional urbanisation has generated environmental problems, so the Chinese Government has proposed a new-type of urbanisation path with uniquely Chinese characteristics. How does this new-type of urbanisation affect CO₂ emissions? Based on panel data from 29 provinces in China (2005 to 2016), we apply an exploratory spatial data analysis model, a spatial econometric model, and a threshold model to analyse the spatial autocorrelation of CO₂ emissions, the direct and indirect effects of new-type urbanisation on CO₂ emissions, and the threshold characteristics produced by technological progress, respectively. The key results are: (1) CO₂ emissions show significant positive autocorrelation in China, and the spatial distribution of CO₂ emissions is HH (High-High) or LL (Low-Low) clustered in most provinces; (2) new-type urbanisation has a paradoxical effect on CO₂ emissions. Energy-saving technology has a rebound effect on CO₂ emissions, but environmental technology inhibits CO₂ emissions; (3) by eliminating the rebound effect of energy-saving technology on CO₂ emissions and promoting environmental technology, new-type urbanisation indirectly inhibits CO₂ emissions; (4) new-type urbanisation exhibits a threshold effect on CO₂ emissions due to the different levels of energy-saving technology and environmental technology. Finally, policy recommendations for CO₂ emissions reduction are proposed from the perspective of new-type urbanisation, energy-saving technology, and environmental technology.     

The CO2–growth nexus revisited: A nonparametric analysis for the G7 economies over nearly two centuries

Using a long dataset and some recently popularized nonparametric econometric techniques, this study revisits the nexus between economic growth and carbon dioxide (CO₂) emissions for the G7 countries over nearly two centuries. The use of nonparametric modelling is warranted by the fact that long historical time series are often subject to structural breaks and other forms of nonlinearity over the course of time. We employ nonparametric cointegration and causality tests along with the cross-validated Local Linear regression analysis and validate the existence of the environmental Kuznets curve in six of the G7 countries – Canada, France, Germany, Italy, U.K. and the U.S. – and the only exception is Japan. Our empirical analysis also finds CO₂ emissions and economic growth to be cointegrated and closely interrelated in the Granger sense. Our results are robust and highlight the nonlinear causal relationship between the two variables.