Hellenic Open University Conferences, International Conference on Business & Economics of the Hellenic Open University 2015

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ON THE RELATIONSHIP OF ENERGY USE FROM RENEWABLE AND NON-RENWABLE SOURCES WITH CO2 EMISSIONS AND GROSS DOMESTIC PRODUCT UNDER THE ENVIRONMENTAL KUZNETS CURVE RERSPECTIVE
Dimitra Kaika, Dimitrios Asteriou, Efthimios Zervas

Building: Titania
Room: Solon
Date: 2015-02-07 11:00 AM – 01:00 PM
Last modified: 2015-01-27

Abstract


Many studies indicate that the structure of modern economies is characterized by strong interdependence between energy consumption and economic growth, while any increase in the national product leads to increased CO2 emissions. According to the Environmental Kuznets Curve hypothesis (EKC), further economic growth could lead to a deceleration of the environmental degradation and of CO2 emissions in particular. This hypothesis is neither confirmed nor rejected adequately in the empirical literature. The substitution of traditional energy sources with renewable energy sources is proposed as an essential way to solve the problem of reducing CO2 emissions without inhibiting the process of economic growth. The present paper attempts to investigate empirically the historical relationship among the variables of energy consumption from renewable and conventional energy sources, economic growth and CO2 emissions by adopting appropriate models based on the Environmental Kuznets Curve hypothesis. The specification of the model considers energy consumption from renewable and conventional energy sources as exogenous variables. The methodology adopted is based on the Johansen’s testing approach of cointegration, the estimation of a vector error correction model (VECM) and the Granger causality tests.


Keywords


CO2 emissions; economic growth; renewable energy sources; non-renewable energy sources; long run equilibrium