Environmental Kuznets curve for CO2 in Canada

Abstract

The environmental Kuznets curve hypothesis is a theory by which the relationship between per capita GDP and per capita pollutant emissions has an inverted U shape. This implies that, past a certain point, economic growth may actually be profitable for environmental quality. Most studies on this subject are based on estimating fully parametric quadratic or cubic regression models. While this is not technically wrong, such an approach somewhat lacks flexibility since it may fail to detect the true shape of the relationship if it happens not to be of the specified form. We use semiparametric and flexible nonlinear parametric modelling methods in an attempt to provide more robust inferences. We find little evidence in favour of the environmental Kuznets curve hypothesis. Our main results could be interpreted as indicating that the oil shock of the 1970s has had an important impact on progress towards less polluting technology and production.

The Environmental Kuznets Curve and the Structural Change Hypothesis

“…Holtz-Eakin and find that C O 2 emissions increase over any possible income range for a rich panel of country for the years 1951-1986. Others find an N-shaped relationship (Friedl and Getzner 2003;Martínez-Zarzoso and Bengoechea-Morancho 2004), which suggests that de-linking environmental degradation from economic growth might be only temporary (He and Richard 2010).…”

Environmental degradation, ICT and inclusive development in Sub-Saharan Africa

“…With regard to CO 2 emissions, recent environmental degradation literature has largely focused on nexuses between energy consumption, CO 2 emissions and economic growth. The existing literature has been dominated by a discussion of the relationship between environmental pollution and economic growth, with a fundamental emphasis on the Environmental Kuznets Curve (EKC) hypothesis (see Akbostanci et al, 2009;Diao et al, 2009;He & Richard, 2010) 1 . Existing literature also considers the nexus between economic growth, environmental pollution and energy consumption (Jumbe, 2004;Ang, 2007;Odhiambo, 2009aOdhiambo, , 2009bApergis & Payne, 2009;Menyah & Wolde-Rufael, 2010;Ozturk & Acaravci, 2010;Bölük & Mehmet, 2015;Begum et al, 2015) and connections between energy consumption and economic growth (Mehrara, 2007;Esso, 2010).…”

Revisiting carbon Kuznets curves with endogenous breaks modeling: evidence of decoupling and saturation (but few inverted-Us) for individual OECD countries

“…Besides nonparametric estimations, He and Richard (2010), who analyzed Canada, employed the nonlinear flexible parametric approach of Hamilton (2001). Yet again, the proofs in Hamilton (2001) assumed stationarity.…”

“…Yet again, the proofs in Hamilton (2001) assumed stationarity. Lastly, the current state of knowledge in the literature seems to be that any determination of delinking or negative relationship between pollution and income likely is a product of "country-specific characteristics such as technological progress, structural evolution, or external shocks" (He andRichard 2010, p. 1084); thus, our proposed approach should be particularly appropriate since it both (i) explicitly estimates regime change (as opposed to the typically smooth transitional estimations of nonparametric models), and (ii) focuses on individual country estimates. g, 1914-1921 and 1943-1945); in addition to breaks in CO2 emissions per capita during those two periods, all countries display a substantial break in GDP per capita around the Great Depression (e.g., 1930Depression (e.g., -1939.…”