What are the carbon emissions elasticities for income and population? Bridging STIRPAT and EKC via robust heterogeneous panel estimates. (March 2015)

• Record Type: Journal Article
• Authors: Liddle, Brantley
• Is Part Of: Global environmental change. Volume 31(2015:Mar.)
• Page Start: 62
• Page End: 73
• Publication Date: 2015-03
• Subjects: Carbon Kuznets curves -- Kaya identity -- Population and environment -- Nonstationary panels -- Cross sectional dependence -- Nonlinearities in environment and development; Environmental policy -- Periodicals; Human ecology -- Periodicals; Nature -- Effect of human beings on -- Periodicals; Environment -- Periodicals; Environnement -- Politique gouvernementale -- Périodiques; Écologie humaine -- Périodiques; Homme -- Influence sur la nature -- Périodiques; Environmental policy; Human ecology; Nature -- Effect of human beings on; Periodicals; Electronic journals; 333.7
• DOI: 10.1016/j.gloenvcha.2014.10.016
• Languages: English
• ISSNs: 0959-3780

Abstract

Highlights: Carbon elasticity of income is highly robust over time. Carbon elasticity of income for OECD countries is less than one. OECD income elasticity significantly smaller than that of non-OECD countries. Carbon elasticity of population is not robust over time. Population elasticity is not statistically significantly different from one. 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.