Energy consumption, carbon emissions and economic growth in Saudi Arabia: An aggregate and disaggregate analysis
TL;DR: In this article, the authors examined the relationship among economic growth, carbon emissions and energy consumption at the aggregate and disaggregate levels and found that carbon emissions increase with the increase in per capita income.
About: This article is published in Energy Policy.The article was published on 2013-11-01. It has received 247 citations till now. The article focuses on the topics: Per capita income & Per capita.
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TL;DR: In this article, the causal relationship between financial development, trade, economic growth, energy consumption and carbon emissions in Turkey for the 1960-2007 period was examined, and the results showed that an increase in foreign trade to GDP ratio results an increased per capita carbon emissions and financial development variable has no significant effect on carbon emissions.
941 citations
TL;DR: There is enough evidence to support one-way causality running from GDP to energy consumption, from financial development to output, and from urbanization to financial development, and the US government should take into account the importance of trade openness, urbanization, and financial development in controlling for the levels of GDP and pollution.
Abstract: This study aims to investigate the relationship between carbon dioxide (CO2) emissions, energy consumption, real output (GDP), the square of real output (GDP2), trade openness, urbanization, and financial development in the USA for the period 1960–2010. The bounds testing for cointegration indicates that the analyzed variables are cointegrated. In the long run, energy consumption and urbanization increase environmental degradation while financial development has no effect on it, and trade leads to environmental improvements. In addition, this study does not support the validity of the environmental Kuznets curve (EKC) hypothesis for the USA because real output leads to environmental improvements while GDP2 increases the levels of gas emissions. The results from the Granger causality test show that there is bidirectional causality between CO2 and GDP, CO2 and energy consumption, CO2 and urbanization, GDP and urbanization, and GDP and trade openness while no causality is determined between CO2 and trade openness, and gas emissions and financial development. In addition, we have enough evidence to support one-way causality running from GDP to energy consumption, from financial development to output, and from urbanization to financial development. In light of the long-run estimates and the Granger causality analysis, the US government should take into account the importance of trade openness, urbanization, and financial development in controlling for the levels of GDP and pollution. Moreover, it should be noted that the development of efficient energy policies likely contributes to lower CO2 emissions without harming real output.
786 citations
Cites methods from "Energy consumption, carbon emission..."
...Moreover, Ang (2007), Jalil and Mahmud (2009), Alam et al. (2012), Ozturk and Acaravci (2013), Shahbaz et al. (2013a), Alkhathlan and Javid (2013), and Boutabba (2014), using time series data, also support the empirical presence of the EKC hypothesis for France, China, Turkey, Bangladesh, South…...
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TL;DR: In this paper, the authors investigated the impact of foreign direct investment, economic growth and energy consumption on carbon emissions in five selected member countries in the Association of South East Asian Nations (ASEAN-5), including Indonesia, Malaysia, the Philippines, Singapore and Thailand.
557 citations
Cites background from "Energy consumption, carbon emission..."
...there is some evidence that the EKC hypothesis is a linear relationship (Khalid and Muhammad, 2013) and an N-shaped relationship (He and Richard, 2010), and some find that the EKC hypothesis is invalid....
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...…postulates an inverted U-shaped relationship between economic growth and CO2 emissions, there is some evidence that the EKC hypothesis is a linear relationship (Khalid and Muhammad, 2013) and an N-shaped relationship (He and Richard, 2010), and some find that the EKC hypothesis is invalid....
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TL;DR: In this paper, the authors examined the empirical effects of economic growth, electricity consumption, foreign direct investment (FDI), and financial development on carbon dioxide (CO2) emissions in Kuwait using time series data for the period 1980-2013.
Abstract: This study examined the empirical effects of economic growth, electricity consumption, foreign direct investment (FDI), and financial development on carbon dioxide (CO2) emissions in Kuwait using time series data for the period 1980–2013. To achieve this goal, we applied the autoregressive distributed lag (ARDL) bounds testing approach and found that cointegration exists among the series. Findings indicate that economic growth, electricity consumption, and FDI stimulate CO2 emissions in both the short and long run. The VECM Granger causality analysis revealed that FDI, economic growth, and electricity consumption strongly Granger-cause CO2 emissions. Based on these findings, the study recommends that Kuwait reduce emissions by expanding its existing Carbon Capture, Utilization, and Storage plants; capitalizing on its vast solar and wind energy; reducing high subsidies of the residential electricity scheme; and aggressively investing in energy research to build expertise for achieving electricity generation efficiency.
486 citations
TL;DR: In this article, the authors investigated the causes of carbon emissions by taking into account the role of financial development and economic growth in GCC countries, and found a long-run unidirectional causality running from carbon emissions to energy use in the case of Saudi Arabia, UAE, and Qatar.
Abstract: This study investigates the dynamic causal relationships among carbon emissions, financial development, economic growth, and energy consumption for Gulf Cooperation Council (GCC) countries from 1980 through 2011. Annual time series data and an autoregressive distributed lag (ARDL) model are used. The main contribution of this paper is that it has investigated the causes of carbon emissions by taking into account the role of financial development and economic growth in GCC countries. The results suggest long-run and causal relationships among carbon emissions, financial development, gross domestic product (GDP), and energy use in all GCC countries except United Arab Emirates (UAE). Moreover, there is long-run unidirectional causality running from carbon emissions to energy use in the case of Saudi Arabia, UAE, and Qatar. Furthermore, a one-way causal relationship from financial development to carbon emissions in the context of UAE, Oman, and Kuwait is found. The evidence suggests that financial systems should take into account environmental aspects in their current operations in these countries. The results of this study may be of great importance for policy and decision makers in developing energy policies for GCC countries that contribute to curbing carbon emissions while preserving economic growth.
410 citations
References
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TL;DR: In this paper, the authors developed a new approach to the problem of testing the existence of a level relationship between a dependent variable and a set of regressors, when it is not known with certainty whether the underlying regressors are trend- or first-difference stationary.
Abstract: This paper develops a new approach to the problem of testing the existence of a level relationship between a dependent variable and a set of regressors, when it is not known with certainty whether the underlying regressors are trend- or first-difference stationary. The proposed tests are based on standard F- and t-statistics used to test the significance of the lagged levels of the variables in a univariate equilibrium correction mechanism. The asymptotic distributions of these statistics are non-standard under the null hypothesis that there exists no level relationship, irrespective of whether the regressors are I(0) or I(1). Two sets of asymptotic critical values are provided: one when all regressors are purely I(1) and the other if they are all purely I(0). These two sets of critical values provide a band covering all possible classifications of the regressors into purely I(0), purely I(1) or mutually cointegrated. Accordingly, various bounds testing procedures are proposed. It is shown that the proposed tests are consistent, and their asymptotic distribution under the null and suitably defined local alternatives are derived. The empirical relevance of the bounds procedures is demonstrated by a re-examination of the earnings equation included in the UK Treasury macroeconometric model. Copyright © 2001 John Wiley & Sons, Ltd.
13,898 citations
"Energy consumption, carbon emission..." refers methods in this paper
...The autoregressive distributed lag (ARDL) approach to cointegration proposed by Pesaran et al. (2001) has been used in this study....
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TL;DR: In this paper, the authors consider the null hypothesis that a time series has a unit root with possibly nonzero drift against the alternative that the process is "trend-stationary" and show how standard tests of the unit root hypothesis against trend stationary alternatives cannot reject the unit-root hypothesis if the true data generating mechanism is that of stationary fluctuations around a trend function which contains a one-time break.
Abstract: We consider the null hypothesis that a time series has a unit root with possibly nonzero drift against the alternative that the process is «trend-stationary». The interest is that we allow under both the null and alternative hypotheses for the presence for a one-time change in the level or in the slope of the trend function. We show how standard tests of the unit root hypothesis against trend stationary alternatives cannot reject the unit root hypothesis if the true data generating mechanism is that of stationary fluctuations around a trend function which contains a one-time break
7,471 citations
TL;DR: In this paper, a variation of Perron's test is considered in which the breakpoint is estimated rather than fixed, and the asymptotic distribution of the estimated breakpoint test statistic is determined.
Abstract: Recently, Perron has carried out tests of the unit-root hypothesis against the alternative hypothesis of trend stationarity with a break in the trend occurring at the Great Crash of 1929 or at the 1973 oil-price shock. His analysis covers the Nelson–Plosser macroeconomic data series as well as a postwar quarterly real gross national product (GNP) series. His tests reject the unit-root null hypothesis for most of the series. This article takes issue with the assumption used by Perron that the Great Crash and the oil-price shock can be treated as exogenous events. A variation of Perron's test is considered in which the breakpoint is estimated rather than fixed. We argue that this test is more appropriate than Perron's because it circumvents the problem of data-mining. The asymptotic distribution of the estimated breakpoint test statistic is determined. The data series considered by Perron are reanalyzed using this test statistic. The empirical results make use of the asymptotics developed for the test stati...
6,608 citations
"Energy consumption, carbon emission..." refers background in this paper
...Zivot and Andrews (1992) test for a unit root in Models (A)–(C) involve the following equations: Model ðAÞ yt ¼ α0 þ α1DUt þ βt þ ρyt 1 þ ∑ p i ¼ 1 φiΔyt i þ et Model ðBÞ yt ¼ α0 þ γDTt þ βt þ ρyt 1 þ ∑ p i ¼ 1 φiΔyt i þ et Model ðCÞ yt ¼ α0 þ α1DUt þ γDTt þ βt þ ρyt 1 þ ∑ p i ¼ 1 φiΔyt i þ…...
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...Zivot and Andrews (1992) proposed three models to determine the break points endogenously to test the time series properties of data....
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TL;DR: In this article, the authors present empirical evidence to assess the relative magnitudes of these three effects as they apply to further trade liberalization in Mexico and investigate whether the size of pollution abatement costs in US industry influences the pattern of international trade and investment.
Abstract: In general, a reduction in trade barriers will affect the environment by expanding the scale of economic activity, by altering the composition of economic activity and by initiating a change in the techniques of production. We present empirical evidence to assess the relative magnitudes of these three effects as they apply to further trade liberalization in Mexico. We first use comparable measures of three air pollutants in a cross-section of urban areas located in 42 countries to study the relationship between air quality and economic growth. We find for two pollutants (sulphur dioxide and `smoke') that concentrations increase with per capita GDP at low levels of national income, but decrease with GDP growth at higher levels of income. We then study the determinants of the industry pattern of US imports from Mexico and of value added by Mexico's maquiladora sector. We investigate whether the size of pollution abatement costs in US industry influences the pattern of international trade and investment. Finally, we use the results from a computable general equilibrium model to study the likely compositional effect of a North American Free Trade Agreement (NAFTA) on pollution in Mexico.
3,091 citations
TL;DR: A critical history of the environmental Kuznets curve (EKC) can be found in this article, where a new generation of decomposition and efficient frontier models can help disentangle the true relations between development and the environment and may lead to the demise of the classic EKC.
2,904 citations
"Energy consumption, carbon emission..." refers background in this paper
...As Stern (2004) and Narayan and Narayan (2010) noted, most of the EKC literature is econometrically weak....
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...According to the EKC hypothesis, at early stages of economic growth, degradation and pollution increases, but beyond some level of income per capita, the trend reverses, such that a high level of income leads to environmental improvement (Stern, 2004)....
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...Subsequently, the studies of Stern (2004) and Dinda (2004), among others, have provided extensive review surveys of the studies that tested the economic growth and environmental pollution nexus....
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