System dynamics modelling and the environmental Kuznets curve in Ecuador (1980–2025)

Abstract

Is it possible for a country in the process of development to comply with the Environmental Kuznets Curve (EKC) hypothesis in the medium term? This is question that inspired this study. This paper is an extension of a previous study focused on economic development and CO 2 emissions in the coming years in Ecuador (Robalino-López et al., 2013). The main goal of this paper is to analyze whether the EKC hypothesis holds within the period 1980-2025 under four different scenarios. This paper uses co-integration techniques (Stock and Watson, 1993) to test the existence of the EKC hypothesis in Ecuador in the medium term using the Jaunky's specification (Jaunky, 2011). Our proposal goes a step further than previous contributions, and intends to see under which conditions a country could approach the fulfilment of this hypothesis in the medium term. Results do not support the fulfilment of the EKC, nevertheless, our estimations show that Ecuador could be on the way to achieving environmental stabilization in the near future if economic growth is combined with an increase in the use of renewable energies, an improvement of the productive sectoral structure, and the use of a more efficient fossil fuel technology.

Studying the relationship between economic growth, CO2 emissions, and the environmental Kuznets curve in Venezuela (1980–2025)

“…[2], because the authors study the EKC fulfillment not with past data, but in a forthcoming period. They studied Ecuador from 1980 to 2025, starting with the model proposed in [1].…”

“…Furthermore, Chien and Hu [10], Robalino-López et al [1,2] show that increasing the use of renewable energy improves the CO 2 emission efficiency of the economy.…”

“…The paper is an effort to study in detail how changes in the driving forces of the economy affect CO 2 emissions. We study the case of Venezuela for the period 1980-2025, using the methodology proposed by Robalino-López et al [1,2], which is based on an extension of the Kaya identity and on a GDP formation approach that includes the effect of renewable energies. We test the environmental Kuznets curve (EKC) [3] hypothesis in a coming future under different economic scenarios considering, therefore, not only past data but also projections for the coming years.…”

“…One of our aims is to estimate CO 2 emissions in Venezuela during the period 2011-2025, using a model already presented in Robalino-López et al [1,2], under four different scenarios which constrain GDP, productive sectoral structure, energy intensity, and energy matrix. Moreover, we will try to disentangle how these factors affect CO 2 emissions and to know whether and when EKC hypothesis could be accomplished in Venezuela in the medium term.…”

“…To this end we use a model which is based on an extension of the Kaya identity 2 [17] and on a GDP formation approach which links renewable energy and income [18]. The methodology was first presented by Robalino-López et al [1,2] and was applied to Ecuador, here it will be applied to Venezuela.…”