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What Are the Carbon Emissions Elasticities for Income and Population? Bridging STIRPAT and EKC via robust heterogeneous panel estimates

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  • Liddle, Brantley
Abstract
Knowledge of the carbon emissions elasticities of income and population is important both for climate change policy/negotiations and for generating projections of carbon emissions. However, previous estimations of these elasticities using the well-known STIRPAT framework have produced such wide-ranging estimates that they add little insight. This paper presents estimates of the STIRPAT model that address that shortcoming, as well as the issues of cross-sectional dependence, heterogeneity, and the nonlinear transformation of a potentially integrated variable, i.e., income. Among the findings are that the carbon emissions elasticity of income is highly robust; and that the income elasticity for OECD countries is less than one, and likely less than the non-OECD country income elasticity, which is not significantly different from one. By contrast, the carbon emissions elasticity of population is not robust; however, that elasticity is likely not statistically significantly different from one for either OECD or non-OECD countries. Lastly, the heterogeneous estimators were exploited to reject a Carbon Kuznets Curve: while the country-specific income elasticities declined over observed average income-levels, the trend line had a slight U-shape.

Suggested Citation

  • Liddle, Brantley, 2015. "What Are the Carbon Emissions Elasticities for Income and Population? Bridging STIRPAT and EKC via robust heterogeneous panel estimates," MPRA Paper 61304, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:61304
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    References listed on IDEAS

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    More about this item

    Keywords

    Carbon Kuznets Curves; Kaya identity; population and environment; nonstationary panels; cross sectional dependence; nonlinearities in environment and development.;
    All these keywords.

    JEL classification:

    • C18 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Methodolical Issues: General
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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