Convergence in carbon dioxide emissions and the role of growth and institutions: a parametric and non-parametric analysis
2016 (English)In: Environmental Economics and Policy Studies, ISSN 1432-847X, E-ISSN 1867-383XArticle in journal (Refereed) Epub ahead of print
This paper examines convergence of per capita carbon dioxide (CO2) emission for a panel of 124 countries taking into account the impact of economic growth and the quality of government institutions. The analysis builds on both parametric and non-parametric panel data techniques, and we examine the β-convergence hypothesis in a neoclassical growth model setting with institutional quality as one of the independent variables influencing both emissions and output growth. The results reveal evidence in support of β-convergence of per capita CO2 emissions for the global sample, and for the sub-samples comprising OECD versus non-OECD countries and high- versus low-income countries, respectively. There is, however, heterogeneity in β-convergence and it tends to vary with the level of the initial per capita CO2 emissions. We also report evidence of a negative direct effect of institutional quality on growth in per capita CO2emissions, especially for the global and high-income samples. However, institutional quality also promotes economic growth, thus generating a positive indirect effect on emissions growth. Overall the empirical results suggest a positive net effect of institutional quality on growth in per capita CO2 emissions in the global sample. Finally, the non-parametric approach reveals some evidence of bias in the parametric approach, in particular in the case of the estimates for the convergence parameter at either end of the distribution.
Place, publisher, year, edition, pages
Carbon dioxide emissions, Convergence, Institutional quality, Economic growth, Non-parametric approach
IdentifiersURN: urn:nbn:se:umu:diva-123090DOI: 10.1007/s10018-016-0162-5OAI: oai:DiVA.org:umu-123090DiVA: diva2:943078