Advertisement

Reassessing the environmental Kuznets curve: a summability approach for emerging market economies

  • Seref BozokluEmail author
  • A. Oguz Demir
  • Sinan Ataer
Original Paper
  • 20 Downloads

Abstract

This study investigates the robustness and validity of the environmental Kuznets curve hypothesis for Brazil, Chile, China, Colombia, Egypt, Greece, India, Indonesia, South Korea, Malaysia, Mexico, Peru, the Philippines, Thailand, and Turkey. The hypothesis postulates the connection between pollution and income follows an inverted U-shaped path, which means that environmental degeneration rises with income during the beginning phases of economic growth; however, it declines after reaching a specified peak. For the empirical part of our study, we employed summability procedures designed to analyze the nonlinear long-term relationship for persistent processes. The yearly data consist of carbon dioxide emission and gross domestic product, both of which are expressed in per capita terms and cover the period from 1960 to 2014. The results illustrate the Environmental Kuznets Curve hypothesis holds for China, Colombia, India, South Korea, and the Philippines, which means that environmental problems wither away with economic growth and are resolved automatically without any need for policy action in these countries.

Keywords

Balancedness CO2 emissions Co-summability Emerging markets Environmental Kuznets curve Nonlinear co-integration 

JEL Classification

C22 Q53 Q56 

Notes

Acknowledgements

We wish to thank the anonymous referee for many helpful comments. Special thanks go to the Editor for allowing us the opportunity to revise our work. Any remaining errors are solely ours.

References

  1. Akbostanci, E., Turut-Asik, S., & Tunc, G. I. (2009). The relationship between income and environment in Turkey: Is there an environmental Kuznets curve? Energy Policy, 37(3), 861–867.CrossRefGoogle Scholar
  2. Alam, M., Murad, W., Noman, A. H., & Ozturk, I. (2016). Relationships among carbon emissions, economic growth, energy consumption and population growth: Testing environmental Kuznets curve hypothesis for Brazil, China, India and Indonesia. Ecological Indicators, 70, 466–479.CrossRefGoogle Scholar
  3. Al-Mulali, U., Tang, C. F., & Ozturk, I. (2015). Estimating the environment Kuznets curve hypothesis: Evidence from Latin America and the Caribbean countries. Renewable and Sustainable Energy Reviews, 50, 918–924.CrossRefGoogle Scholar
  4. Berenguer-Rico, V., & Gonzalo, J. (2013). Co-summability: From linear to non-linear cointegration. Universidad Carlos III de Madrid working paper (no. 13–12).Google Scholar
  5. Berenguer-Rico, V., & Gonzalo, J. (2014). Summability of stochastic processes: A generalization of integration for non-linear processes. Journal of Econometrics, 178, 331–341.CrossRefGoogle Scholar
  6. Dasgupta, S., & Heal, G. M. (1979). Economic theory and exhaustible resources. Cambridge: Cambridge University Press.Google Scholar
  7. Dasgupta, S., Laplante, B., Wang, H., & Wheeler, D. (2002). Confronting the environmental Kuznets curve. Journal of Economic Perspectives, 16(1), 147–168.CrossRefGoogle Scholar
  8. Dinda, S. (2004). Environmental Kuznets curve hypothesis: A survey. Ecological Economics, 49(4), 431–455.CrossRefGoogle Scholar
  9. Eberhardt, M., & Presbitero, A. F. (2015). Public debt and growth: Heterogeneity and non-linearity. Journal of International Economics, 97(1), 45–58.CrossRefGoogle Scholar
  10. Engle, R. F., & Granger, C. W. (1987). Co-integration and error correction: Representation, estimation, and testing. Econometrica: Journal of the Econometric Society, 55(2), 251–276.CrossRefGoogle Scholar
  11. Ghosh, S. (2010). Examining carbon emissions economic growth nexus for India: A multivariate cointegration approach. Energy Policy, 38(6), 3008–3014.CrossRefGoogle Scholar
  12. Gonzalo, J., & Pitarakis, J. (2006). Threshold effects in cointegrating relationships. Oxford Bulletin of Economics and Statistics, 68, 813–833.CrossRefGoogle Scholar
  13. Govindaraju, V. C., & Tang, C. F. (2013). The dynamic links between CO2 emissions, economic growth and coal consumption in China and India. Applied Energy, 104, 310–318.CrossRefGoogle Scholar
  14. Grossman, G. M., & Krueger, A. B. (1991). Environmental impacts of a North American free trade agreement, National Bureau of Economic Research, working paper 3914.Google Scholar
  15. Grossman, G. M., & Krueger, A. B. (1995). Economic growth and the environment. The Quarterly Journal of Economics, 110(2), 353–377.CrossRefGoogle Scholar
  16. Holtz-Eakin, D., & Selden, T. M. (1995). Stoking the fires? CO2 Emissions and economic growth. Journal of Public Economics, 57(1), 85–101.CrossRefGoogle Scholar
  17. Hong, S. H., & Wagner, M. (2008). Nonlinear cointegration analysis and the environmental Kuznets curve. Reihe Ökonomie/Economics series no. 224, Institut für Höhere Studien (IHS).Google Scholar
  18. Kijima, M., Nishide, K., & Ohyana, A. (2010). Economic models for the environmental Kuznets curve: A survey. Journal of Economic Dynamics and Control, 34(7), 1187–1201.CrossRefGoogle Scholar
  19. Kuznets, S. (1955). Economic growth and income inequality. The American Economic Review, 45(1), 128.Google Scholar
  20. Lee, H. H., Chung, R. K., & Koo, C. M. (2005). On the relationship between economic growth and environmental sustainability. In Ministerial conference on environment and development in Asia and Pacific (p 26).Google Scholar
  21. Meadows, D. H., Meadows, D. L., Randers, J., & Behrens, W. W. (1972). The limits to growth. New York: Universe Books.Google Scholar
  22. Monserrate, M. A. Z., Bajana, I. V., Bohorquez, J. A., & Jimenez, M. M. (2016). Relationship between economic growth and environmental degradation: Is there evidence of an environmental Kuznets curve for Brazil? International Journal of Energy Economics and Policy, 6(2), 208–216.Google Scholar
  23. Narayan, P. K., & Narayan, S. (2010). Carbon dioxide emissions and economic growth: Panel data evidence from developing countries. Energy Policy, 38(1), 661–666.CrossRefGoogle Scholar
  24. Nasr, A. B., Gupta, R., & Sato, J. R. (2015). Is there an environmental kuznets curve for South Africa? A co-summability approach using a century of data. Energy Economics, 52, 136–141.CrossRefGoogle Scholar
  25. Onofowora, O. A., & Owoye, O. (2014). Bounds testing approach to analysis of the environment Kuznets curve hypothesis. Energy Economics, 44, 47–62.CrossRefGoogle Scholar
  26. Panayotou, T. (1997). Demystifying the environmental Kuznets curve: Turning a black box into a policy tool. Environment and Development Economics, 2(4), 465–484.CrossRefGoogle Scholar
  27. Pao, H. T., & Tsai, C. M. (2011). Multivariate granger causality between CO2 emissions, energy consumption, FDI (foreign direct investment) and GDP (gross domestic product): Evidence from a panel of BRIC (Brazil, Russian Federation, India, and China) countries. Energy, 36(1), 685–693.CrossRefGoogle Scholar
  28. Saboori, B., & Jamalludin, S. (2013). CO2 Emissions, energy consumption and economic growth in Association of Southeast Asian Nations (ASEAN) countries: A cointegration approach. Energy, 55, 813–822.CrossRefGoogle Scholar
  29. Stern, D. I. (2004). The rise and fall of the environmental Kuznets curve. World Development, 32(8), 1419–1439.CrossRefGoogle Scholar
  30. Stern, D. I., Common, M. S., & Barbier, E. B. (1996). Economic growth and environmental degradation: The environmental Kuznets curve and sustainable development. World Development, 24(7), 1151–1160.CrossRefGoogle Scholar
  31. Yuan, J. H., Kang, J. G., Zhao, C. H., & Hu, Z. G. (2008). Energy consumption and economic growth: Evidence from China at both aggregated and disaggregated levels. Energy Economics, 30(6), 3077–3094.CrossRefGoogle Scholar

Copyright information

© Eurasia Business and Economics Society 2019

Authors and Affiliations

  1. 1.Department of EconomicsIstanbul UniversityIstanbulTurkey
  2. 2.National Research University Higher School of EconomicsMoscowRussian Federation
  3. 3.Department of Public FinanceIstanbul Medeniyet UniversityIstanbulTurkey

Personalised recommendations