Symmetric and asymmetric impact of oil price, FDI and economic growth on carbon emission in Pakistan: Evidence from ARDL and non-linear ARDL approach

This study empirically investigates the relationship between CO2 emission and four of its potentially contributing factors (i.e., energy consumption, income, trade openness and population) using time series data from 1971-2013 on five selected economies of South Asia. After confirming that all the series are stationary using unit root test process, the study incorporates three different and advance panel cointegration tests i.e. Pedroni- Kao- and Johansen-Fisher-panel cointegration. All the panel cointegration tests confirm that all the variables cointegrated. The long-run association between the variables is checked using FMOLS-grouped and individual cross-section country in the panel. The FMOLS grouped results show that energy consumption, trade openness and population increases environmental degradation in the panel countries with exception of income which has negative impact and sounds the existence of Environmental Kuznet curve between income and emission. The innovative accounting approach using variance decomposition test and impulse response function is applied to examine the causality amongst the underlined vectors. The results show that there is bidirectional causality between energy consumption and trade openness and uni-directional causality running from energy consumption, trade openness and population to CO2 emission. The results enumerate that the energy consumption and population density will increase in long-run and foresee further environmental degradation in the region.

What drives carbon dioxide emissions in the long-run? Evidence from selected South Asian Countries

In this modern era, environmental pollution is the biggest problem attached to industrialization. This study tries to ensure the relationship between industrialization and CO2 emissions in Pakistan for the time period 1980–2018 by using nonlinear ARDL model while controlling for urbanization, GDP, and human capital variables as a likely factor of CO2 emissions. Our foremost study objective is to examine whether or not the outcome of industrialization on CO2 emissions is symmetric or asymmetric for Pakistan that is one of the core suppliers to CO2 in South Asia, as the emissions were 0.82 million tons in 2018. Our result approves the presence of an asymmetric effect of industrialization shocks on CO2 emissions both in the short run and long run. The results reveal that industrialization increases emissions and deindustrialization decrease emissions, in short as well as long run, in Pakistan. Moreover, our finding also advises that urbanization and GDP variables have exerted a positive impact on CO2 emissions. Based on the findings, some policy suggestions are proposed for Pakistan.

On the asymmetric effects of premature deindustrialization on CO2 emissions: evidence from Pakistan

Hierarchical modeling of the 50 largest economies to verify the impact of GDP, population and renewable energy generation in CO2 emissions

Environmental cost of non-renewable energy and economic progress: Do ICT and financial development mitigate some burden?

The aim of this paper is to examine the relationship between CO2 emissions and its possible determinants and their direction of causality for Pakistan over the period of 1972 to 2017. The survey of literature guides us that the most frequently discussed factors are real GDP per capita, energy consumption, urbanization, trade openness, and financial development. Testing of environmental Kuznets curve (EKC) hypothesis is the most common in environment literature so we also incorporated the real GDP per capita squared term in the model. Autoregressive distributed lag (ARDL) bound testing approach to cointegration with structural break and error correction method (ECM) are applied to the selected time series to investigate the long-run relationship between CO2 emissions and real GDP per capita, real GDP per capita squared term, energy consumption, urbanization, trade openness, and financial development. The empirical evidence confirms the cointegration among the variables and EKC holds for Pakistan support H1 of the study, which though contradictory to the previous studies conducted on Pakistan but all of previous work faces the exclusion bias and their findings were skewed. The findings also suggest that energy consumption and urbanization have a positive effect on CO2 emissions, supporting H2 and H3. However, H4 and H5 rejected as trade openness and financial development found positively significant. Moreover, bidirectional Granger causality was exists only between CO2 emissions and trade openness. The findings suggests that Pakistan need to settle the economic agenda of the nation through the resolution of economic controversies, energy mix need to tilt toward clean and renewable energy, and rural-urban migration need to manage for better air, water, and living.

Neelofar Khan

Papers

An empirical investigation of the determinants of CO 2 emissions: evidence from Pakistan