Can CO2 emissions and energy consumption determine the economic performance of South Korea? A time series analysis

Abstract

Following the United Nations Sustainable Development Goals (UN-SDGs), which place emphasis on relevant concerns that encompass access to energy (SDG-7) and sustainable development (SDG-8), this research intends to reexamine the relationship between urbanization, CO 2 emissions, gross capital formation, energy use, and economic growth in South Korea, which has not yet been assessed using recent econometric techniques, based on data covering the period between 1965 and 2019. The present study utilized the autoregressive distributed lag (ARDL), dynamic ordinary least square (DOLS), and fully modified ordinary least squares (FMOLS) methods, while the gradual shift and wavelet coherence techniques are utilized to determine the direction of the causality. The ARDL bounds test reveals a long-run linkage between the variables of interest. Empirical evidence shows that CO 2 emissions trigger economic growth. Thus, based on increasing environmental awareness across the globe, it is necessary to change the energy mix in South Korea to renewables to enable the use of sustainable energy sources and establish an environmentally sustainable ecosystem. Moreover, the energy-induced growth hypothesis is validated. This result is supported by the causality analysis, which shows a one-way causality running from energy consumption to GDP in South Korea. This suggests that South Korea cannot embark on conservative energy policies, as such actions will damage economic progress. Additionally, a unidirectional causality is seen from CO 2 emissions and energy consumption to economic growth. These findings have far-reaching consequences for GDP growth and macroeconomic indicators in South Korea.

Modeling the Dynamic Linkage between Renewable Energy Consumption, Globalization, and Environmental Degradation in South Korea: Does Technological Innovation Matter?

“…In line with the studies of Awosusi et al [3], Alola et al [37] and Sarkodie et al [38], we added GDP into the model. Furthermore, following the studies of Adebayo et al [21], Rjoub et al [39] and He et al [24], we incorporate energy use into the model.…”

“…The presence of air contamination and severe weather conditions, as is regularly witnessed, pose substantial health risks to humans [2]. In this respect, it is critical to pay significant awareness to the topic of climate change; else, the dangers and concerns associated with climate change, which are predicted to rise in the future years, will have disastrous consequences for safety and human health [3,4].…”

Linking Economic Growth, Urbanization, and Environmental Degradation in China: What Is the Role of Hydroelectricity Consumption?

“…In line with the studies of [13,30,40], we added GDP into the model. Moreover, following the studies of [17,29], we incorporated the URB into the model. Lastly, we introduced HYDRO into the model following the studies of [11,30,41,42].…”

“…Their empirical outcomes revealed that both urbanization and GDP caused degradation of the environment, while financial development mitigated CO 2 . The study of Awosusi et al [29] in South Korea on the association between CO 2 and globalization, utilization of energy, and energy use using data from 1965 to 2019 showed that globalization and GDP triggers CO 2 . In China, Soylu et al [13] assessed the CO 2 -GDP-REC association using the novel wavelet coherence and causality approaches.…”

“…Prior research looked at many pollution factors, such as energy usage and GDP [10][11][12][13][14], urban population [11,[15][16][17][18][19][20], financial development [21][22][23], and trade openness [24][25][26][27][28]. Furthermore, because CO 2 emissions account for more than 76 percent of GHGs emissions, the majority of researchers utilized CO 2 as an indication of degradation of the environment [19,25,28,29]. The environmental Kuznets curve (EKC) theory has gained popularity amongst researchers as a significant instrument for environmental policy.…”