The Effects of Energy Consumption, Economic Growth and Financial Development on CO2 Emissions in China: A VECM Approach

Jian, Jianhui; Fan, Xiaojie; He, Pinglin; Xiong, Hao; Shen, Huayu

doi:10.3390/su11184850

Cited by 96 publications

(62 citation statements)

References 64 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…In the model, CO2 emissions was the explained variable, whilst economic growth and energy consumption were the main explanatory variables of concern. CO2 emission was employed as a response variable because it has been proven by Mensah et al (2019), Jian et al (2019) together with Karasoy and Akc¸ay (2019) among others that, it is one of the best measures of environmental degradation. Also, as economic growth of countries increases, the life style of people also changes (shift in consumer behavior and needs).…”

Section: Theoretical Rationale and Model Specificationmentioning

confidence: 99%

RETRACTED: A heterogeneous analysis of the nexus between energy consumption, economic growth and carbon emissions: Evidence from the Group of Twenty (G20) countries

et al. 2020

Energy Exploration & Exploitation

View full text Add to dashboard Cite

The purpose of this study was to examine the nexus amid economic growth, energy consumption and carbon emissions in G20 countries for the period 1992 to 2014. In order to obtain valid and reliable outcomes, more robust econometric techniques were employed. From the results, the studied panel was heterogeneous and cross-sectionally dependent. Also, the series of observed variables were first-differenced stationary and co-integrated. The key findings from the CCEMG and the AMG regression estimators adopted showed that economic growth and energy consumption promoted the emission of carbon in the countries. In addition, urbanization and foreign direct investments as control variables escalated the rate of the countries’ CO2 emissions. From the discoveries of the Dumitrescu and Hurlin panel causality test, a feedback causality between economic growth and CO2 emissions; energy consumption and CO2 emissions; and between urbanization and CO2 emissions were correspondingly unveiled. Howerver, a one-way caual link was evidenced from foreign direct investments to CO2 emissions. This exploration is vital because it will propel the countries to formulate policies that could help them to minimize their dependence on environmentally unfriendly energy sources, while promoting the usage of clean energies like solar, wind, biogas, biomass and hydropower among others. The study is also pertinent because it will aid the countries to plan, organize and implement environmental policies in compliance to their macroeconomic objectives. When this is accomplished, energy conservation policies implemented to minimize the emanation of CO2 will improve the countries’ economic growth.

show abstract

Section: Theoretical Rationale and Model Specificationmentioning

confidence: 99%

RETRACTED: A heterogeneous analysis of the nexus between energy consumption, economic growth and carbon emissions: Evidence from the Group of Twenty (G20) countries

et al. 2020

Energy Exploration & Exploitation

View full text Add to dashboard Cite

show abstract

“…Overall, our result of the long-run equilibrium among the variables supports the findings of [5,71], who found a long-run equilibrium relationship among energy consumption and financial development in Asian countries. Therefore, the consumption of energy in Malaysia, the Philippines, Singapore and Thailand is associated with macroeconomic variables, namely, financial development and economic growth in the long run.…”

Section: Countrysupporting

confidence: 90%

Energy–Finance–Growth Nexus in ASEAN-5 Countries: An ARDL Bounds Test Approach

et al. 2019

View full text Add to dashboard Cite

This study examines the relationship between energy consumption, financial development and economic growth for ASEAN-5 countries, namely Malaysia, Indonesia, the Philippines, Singapore and Thailand, over the period from 1980 to 2017. Finance-growth and energy-growth relationships have been well researched; however, the energy-finance-growth nexus is an equally important but less explored area. Our Auto Regressive Distributed Lags (ARDL) bounds test for cointegration results suggests that the variables tend to move together in the long run for all countries, apart from Indonesia. Our study also considers the effect of a structural break due to financial crisis and confirms that the break does not affect the long-term relationship among the variables; in other words, the financial crisis does not affect the energy-finance-growth nexus. Hence, considering the consistency of energy consumption, the importance of the energy sector must not be undermined, and appropriate energy policies are instrumental in maintaining a well-managed financial sector for sustainable economic growth.Sustainability 2020, 12, 5 2 of 16 demand [15], while the importance of financial variables in investigatng the energy-growth nexus is well documented by [16]. Financial development indicates the actual level of financial resources available for production and channels these funds through banks and stock markets [17]; thus, this promotes economic growth by boosting investment via transparent transactions for productive ventures [15]. A higher level of economic development through raising the capacity of the production sector and attracting foreign investment requires a stable power supply, which necessitates support by the financial sector through channeling resources to the energy sector [18]. A well-developed financial market makes financial resources available to high-return projects; at the same time, this implies better accounting and reporting standards, which increases investors' confidence [19], and attracts Foreign Direct Investment(FDI) [7]; which in turnaffects energy consumption. Similarly, financial development increases energy consumption by enhancing liquidity through the allocation of assets to appropriate ventures [15]. Hence, financial development affects the growth of an economy, which may influence energy consumption [20], and consequently, can act as the missing link in the energy-growth nexus [5]. With the growth in the economy, more productive inputs are needed which are supported by activities such as capital accumulation and energy expenditure where the role of finance is undisputable [21].However, to date, the nature of the relationship remains inconclusive from the relatively small amount of prevailing literature. Some researchers have found a negative relationship between energy consumption and financial development [22], while others detect a positive relationship [13,23]. Similarly, the results of the cointegration and causality analysis-based studies are also inconclusive. Several studies reported bidirectional ...

show abstract

“…The EKC hypothesis is confirmed for China, Brazil and Indonesia. Jian et al (2019) examined the relationships between EMS, GW, FDEV and EM for China for the period of 1982-2017. Bidirectional causality is confirmed between EMS and EM in the long run.…”

Section: Review Of Literaturementioning

confidence: 99%

The Effect of External Debt on Emissions: Evidence From China

Beşe

Friday²,

Özden

2020

IJEEP

View full text Add to dashboard Cite

In this study, the effect of external debt (EXD -current US$) on carbon dioxide emissions (CO 2 -metric tons per capita) is examined by taking the environmental Kuznets curve (EKC) hypothesis as a basis for China. The relationships between CO 2 , gross domestic product per capita (GDP -constant 2010 US$), square of GDP (GD), energy consumption (EM -kg of oil equivalent per capita) and EXD is examined. The autoregressive distributed lag (ARDL) model and nonlinear ARDL model are used to examine symmetric and asymmetric relationships between the variables respectively for the period of 1978-2014 by including a structural break. China has had a growing EXD to support economic growth especially after the 2008 financial crisis. The results show that EXD and EM significantly and positively affect emissions (EMS). The asymmetric relationship between growth (GW) and EMS is confirmed. The EKC hypothesis is not confirmed for China. The results of the study are in line with the current economic structure of the Chinese economy. The Chinese economy is still over reliant on construction, heavy industries and real estate. Although China's current EXD is 13% of GDP, EXD is growing because private companies and local governments continue to invest heavily in construction and real estate, and have increased borrowing from abroad to cover operational costs since the central government's deleveraging policies have made borrowing from domestic markets more difficult.

show abstract

The Effects of Energy Consumption, Economic Growth and Financial Development on CO2 Emissions in China: A VECM Approach

Cited by 96 publications

References 64 publications

RETRACTED: A heterogeneous analysis of the nexus between energy consumption, economic growth and carbon emissions: Evidence from the Group of Twenty (G20) countries

RETRACTED: A heterogeneous analysis of the nexus between energy consumption, economic growth and carbon emissions: Evidence from the Group of Twenty (G20) countries

Energy–Finance–Growth Nexus in ASEAN-5 Countries: An ARDL Bounds Test Approach

The Effect of External Debt on Emissions: Evidence From China

Contact Info

Product

Resources

About