Modelling Energy Consumption, Carbon Dioxide Emissions and Economic Growth Nexus in Ethiopia: Evidence from Cointegration and Causality Analysis (original) (raw)
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Energy Consumption, Carbon Dioxide Emissions and Economic Growth in Ethiopia
2016
This study has attempted to investigate the relationship between, energy consumption, CO 2 emissions and economic growth in Ethiopia, using time series data from 1970/71 to 2010/11. The finding indicates variables of interests are integrated of the same order I (1). Cointegration test approves existence of one co-integrating equation among the variables. The causality test result shows energy consumption causes Economic Growth in Ethiopia. Based on the outcome shocks to energy consumption have a negative impact on economic growth. The contributions of energy consumption to CO 2 emissions were insignificant and economic growth is positively related to CO 2 emissions. To secure the sustenance of CO 2 emissions free economic growth in Ethiopia, cost effective, carbon free, and efficient utilization of renewable energy consumption based on the country comparative advantage that consider alternative use of resources are advisable like Hydro and Geothermal.
Journal of Economics and Development Studies, 2015
Carbon dioxide (CO2) emissions as a main determinant of environmental pollution have been frequently dealed with by research scholars and policy-makers. This study investigates the cointegration and dynamic causal relationship between urbanization, energy consumption and carbon dioxide (CO2) emissions in Sub-Saharan countries for the period between 1985 and 2010. Pedroni and Kao cointegration methods and Granger causality test based on vector error correction model (VECM) are employed to conduct this empirical analysis. The results show that there exists a cointegration relationship between the variables over the period. It is also found that there exists bi-directional Granger causality between some variables in the the long-run as well as in the short-run such as, between energy consumption and CO2 emissions. The results imply that energy consumption and urbanization are the main determinants of environmental pollution in these countries. and a series of policy measures related to urbanization and energy should be taken to decrease the environmental degradation.
International Journal of Scientific and Research Publications, 2020
Carbon dioxide (CO2) emissions are a leading cause of environmental pollution and have been the most significant problems for the worldwide community. This study examines the dynamic causal relationships between CO2 emissions, industrial structure, economic growth and urbanization for the period 1980– 2017 using the Autoregressive Distributed Lag (ARDL) bounds testing approach and Granger causality tests. Augmented DickeyFuller and the Phillips-Perron tests used to examine of unit roots of the variables. The results showed that industrial structure, economic growth and urbanization increases CO2 emissions. The result of Granger causality test indicated that there is a bidirectional causal relationship between industrial structure, economic growth, and urbanization and CO2 emissions. The results recommend that industrial structure, economic growth and urbanization were the main determinants of environmental pollution in Ethiopia and a series of policy actions related to industrial structure, economic growth and urbanization should be taken to reduction the environmental degradation.
Journal of Economic Structures, 2019
Reducing energy intensity is an important element for Ethiopia to achieve its ambitious climate-resilient growth goals. Understanding the factors that determine energy intensity plays a crucial role for academics and policymakers to formulate sound energy conservation and energy efficiency policies. This article investigates drivers of energy intensity in Ethiopia over the period of 1974–2014. The ARDL bounds test approach to cointegration and FMOLS-based Hansen parameter instability test methods were applied to examine the long-run relationship among the variables. The result reveals that there is an inverted U-shape or Environmental Kuznets curve-type relationship between economic growth and energy intensity, implying that economic growth at early (industrialization) stage of development spurs energy intensity while delinking occurs at the later stages of development. Urbanization increases energy intensity, while impact of import is negative. The Toda–Yamamoto Granger causality test result shows a bidirectional causal relationship between import and energy intensity. Moreover, energy intensity Granger causes aid and industrialization.
The study sought to examine the effect of economic growth and energy consumption on Environmental pollution in Ghana using annual time series data from the World Bank’s World Development Indicators between the period 1971 and 2013. Impact of other variables like trade openness and urbanization on the emissions of carbon dioxide for the same period mentioned above were also investigated. Econometrically, the study employed the use of Johansen and Juselius (1990) Cointegration Test and the Vector Error Correction Model (VECM) to investigate the feasible long-run and short-run relationship and effects among the variables under consideration. Granger Causality test was also carried out to find the causality among the variables. The study found all the variables to be integrated of order one, I (1) by applying the use of the Augmented Dickey-Fuller test. The Johansen multivariate test for cointegration indicated existence of long run relationship among the series. The study found no evidence of the Environmental Kuznets Curve (EKC) in the long-run. The study found an insignificant negative relationship between CO2 emissions and economic growth in the short run as well as in the long run while Energy consumption was found to have positive and significant impact on CO2 emissions in Ghana. A positive but insignificant relationship was also found between urbanization (UR) and CO2 emissions in the short run and a significant positive effect in in the long run. The study also found a negative relationship between trade openness and carbon dioxide emissions The Granger Causality test revealed a unidirectional causality running from energy consumption and trade openness to CO2 emissions per capita with no feedback effect.
International Journal of Energy Economics and Policy, 2021
The main objective of this study is to examine the impact of energy consumption and environmental degradation (CO2 emissions) on economic growth in Bangladesh covering the periods of 1972–2018 by employing the Johansen cointegration test, VECM approach, and Granger causality test. The Johansen cointegration result indicates that gross capital formation (GCF), labor, Electricity power consumption (EPC), energy consumption (EC) has a positive and statistically significant effect on economic growth (RGDP) while environmental degradation (carbon dioxide emissions) has an inverse effect on it. The results of VECM show that there exists a long-run causal nexus among the variables and there is short-run causality running from the capital formation and electricity power consumption to the economic growth while there is no short-run causality from the labor, energy consumption, carbon emission to the economic growth. The causality test shows that there exist a unidirectional causal relations...
In this study, the relationship between carbon dioxide emissions, GDP, energy-use and population growth in Ghana was investigated spanning from 1971-2013 by comparing a Vector Error Correction Model (VECM) and Autoregressive and Distributed Lag (ARDL). Prior to testing for Granger causality based on VECM, we tested for unit roots and Johansen’s multivariate co-integration. We also performed a Variance Decomposition Analysis using Cholesky technique and comparing it with other studies. Evidence from the variance decomposition shows that 21% of future shocks in carbon dioxide emissions are due to fluctuations in energy-use, 8% of future shocks are due to fluctuations in GDP and 6% of future shocks are due to fluctuations in population. There was evidence of bidirectional causality running from energy-use to GDP and a unidirectional causality running from carbon dioxide emissions to energy-use, carbon dioxide emissions to GDP, carbon dioxide emissions to population, and population to energy-use. Evidence from the long-run elasticities shows that a 1% increase in population in Ghana will increase carbon dioxide emissions by 1.72%. There was evidence of short-run equilibrium relationship running from energy-use to carbon dioxide emissions and GDP to carbon dioxide emissions. As a policy implication, the addition of renewable energy and clean energy technologies into Ghana’s energy mix can help mitigate climate change and its impact in the future.
Journal of Economic Science Research, 2021
The study scrutinized correlation between electricity production, trade, economic growth, industrialization and carbon dioxide emissions in Ghana. Our study disaggregated trade into export and import to spell out distinctive and individual variable contribution to emissions in Ghana. In an attempt to investigate, the study used time-series data set of World Development Indicators from 1971 to 2014. By means of Autoregressive Distributed Lag (ARDL) cointegrating technique, study established that variables are co-integrated and have long-run equilibrium relationship. Results of long-term effect of explanatory variables on carbon dioxide emissions indicated that 1% each increase of economic growth and industrialization, will cause an increase of emissions by 16.9% and 79% individually whiles each increase of 1% of electricity production, trade exports, trade imports, will cause a decrease in carbon dioxide emissions by 80.3%, 27.7% and 4.1% correspondingly. In the pursuit of carbon emissions' mitigation and achievement of Sustainable Development Goal (SDG) 13, Ghana need to increase electricity production and trade exports.
International Journal of Energy Economics and Policy, 2019
With Uganda's desire to industrialize for economic transformation and development comes with negative effect on environment as carbon emissions increases. Our study used econometric approach to perform empirical analysis to arrive at our findings on causal correlation between carbon dioxide emissions (CO 2), energy intensity, industrialization, and economic expansion in Uganda for the period 1990 to 2014 using autoregressive distributed lag (ARDL) approach. In the long-run, economic growth and industrialization increase of 1% each increase carbon emission by 31.1% and 3.2% respectively while 1% increase in energy intensity decrease emission by 83.9%. Results of ARDL shows that, joint effect of energy intensity, economic progress and industrialization at constant decrease emissions by 2.46% in Uganda. In the pursuit of carbon emissions mitigation in Uganda, there is the need to increase energy intensity to reduce emissions level in the long-run. This requires the need to undertake wide-ranging of policy and institutional reforms.