Environmental Kuznets Curve and the role of energy consumption in Pakistan

Shahbaz Muhammad, Hooi Hooi Lean () and Shahbaz Shabbir ()
Authors registered in the RePEc Author Service: Muhammad Shahbaz

MPRA Paper from University Library of Munich, Germany

Abstract: The paper is an effort to fill the gap in the energy literature with a comprehensive country study for Pakistan. We investigate the relationship between CO2 emissions, energy consumption, economic growth and trade openness for Pakistan over the period of 1971-2009. Bounds test for cointegration and Granger causality test are employed for the empirical analysis. The result suggests that there exists long-run relationship among the variables and the Environmental Kuznets Curve (EKC) hypothesis is supported. The significant existence of EKC shows the country's effort to condense CO2 emissions and indicates a reasonable achievement of controlling environmental degradation in Pakistan. Furthermore, we find one-way causal relationship running from income to CO2 emissions. Energy consumption increases CO2 emissions both in the short and long runs. Trade openness reduces CO2 emissions in the long run but it is insignificant in the short run. In addition, the change in CO2 emissions from short run to the long span of time is corrected by about 10 percent each year.

Keywords: CO2 emissions; energy consumption; trade openness (search for similar items in EconPapers)
JEL-codes: P28 (search for similar items in EconPapers)
Date: 2011-11-10, Revised 2011-11-22
New Economics Papers: this item is included in nep-ene, nep-env and nep-res
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

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