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Long-Run Dynamics of Gas Emissions, Economic Growth, and Low-Carbon Energy in the European Union: The Fostering Effect of FDI and Trade
| Content Provider | MDPI |
|---|---|
| Author | Horobet, Alexandra Popovici, Oana Zlatea, Emanuela Belascu, Lucian Dumitrescu, Dan Curea, Stefania |
| Copyright Year | 2021 |
| Description | The European Union’s environmental goal by 2050 is to become the first climate-neutral continent in the world. This means specific efforts for diversifying the energy mix and investing in low-carbon energy. Our study investigates the nexus among carbon emissions, energy consumption and mix, and economic growth in a modified framework that includes the contribution of inward foreign direct investments and international trade to lowering air pollution. We have used a two-step approach to explore in more detail the links between these variables in 24 EU countries over the period 1995–2018, followed by a panel VECM analysis. Our results indicate that there is a unidirectional link between economic growth and $CO_{2}$ emissions, which should imply a decoupling of environmental improvement measures from the pace of economic growth. We also find bidirectional causal relationships between low-carbon energy shares in consumption and $CO_{2}$ emissions, as well as between low-carbon energy share in consumption and GDP per capita, which confirms both pollution haven and the halo effect hypotheses for FDI on gas emissions. However, in the long term, FDI, exports, and imports have positively impacted the reduction in $CO_{2}$ emissions; therefore, stronger EU investment and trade integration should be promoted to improve the quality of the environment. |
| Starting Page | 2858 |
| e-ISSN | 19961073 |
| DOI | 10.3390/en14102858 |
| Journal | Energies |
| Issue Number | 10 |
| Volume Number | 14 |
| Language | English |
| Publisher | MDPI |
| Publisher Date | 2021-05-15 |
| Access Restriction | Open |
| Subject Keyword | Energies Environmental Engineering Gas Emissions Low-carbon Energy Economic Growth Foreign Direct Investments Trade European Union |
| Content Type | Text |
| Resource Type | Article |
