We employ a non-parametric modelling technique to examine the time-varying impact of renewable and non-renewable energy consumption on economic growth. The specific nonparametric method that we ...employ is the local linear dummy variable estimation (LLDVE) method, which we apply to OECD and non-OECD panels for the period 1990 to 2015. While previous studies employing parametric models have recognised the existence of non-linearities and instability in the relationship between renewable (and non-renewable) energy consumption and economic growth, the LLDVE method has the advantage that it does not make any assumptions about functional form and, hence, is better able to approximate the non-linear relationship. Our estimates suggest that non-renewable energy consumption exerts a positive and significant impact on economic growth across OECD nations with the coefficient function exhibiting an upward trajectory over time. The impact of renewable energy consumption on economic growth, however, is statistically indistinguishable from zero in these countries for most of the study period. Both renewable and non-renewable energy consumption promote economic growth in non-OECD countries, suggesting that developing countries may play an important role in the transition process to renewables despite constraints in technical progress.
•We examine the effect of human capital on energy consumption for a panel of OECD economies over the period 1965–2014.•Our results suggest that human capital reduces aggregate energy consumption by ...15.36%.•We find that human capital is associated with a 17.33% decrease in dirty energy consumption and an 85.54% increase in clean energy consumption.•Our findings emphasize the social benefits of investing in human capital
We examine the effect of human capital on energy consumption for a panel of OECD economies over the period 1965–2014. Our preferred results, which account for cross-sectional dependence and structural breaks, suggest that a one standard deviation increase in human capital reduces aggregate energy consumption by 15.36%. When we distinguish between clean and dirty energy consumption, we find that human capital generates significant positive externalities for the environment. Specifically, we find that a one standard deviation increase in human capital is associated with a 17.33% decrease in dirty energy consumption and an 85.54% increase in clean energy consumption. Our findings reinforce the social benefits of investing in human capital and suggest a promising avenue for energy conservation without impeding economic growth.
Carbon dioxide (CO2) emissions play an important role in global warming. Consequently, studying the relationship between CO2 emissions and economic development is important, especially when viewed ...from a historical perspective. We test the Environmental Kuznets Curve (EKC) hypothesis for a panel of 20 OECD nations, dating back to the first globalization boom in the nineteenth century. Utilising recently developed panel data estimators that account for cross-sectional dependence and parameter heterogeneity, for the period 1870 to 2014, we find support for the EKC hypothesis for the panel as a whole with three of our preferred four estimators, with turning points in income per capita that lie between $18,955 and $89,540 (in 1990 US$). Country-specific results, however, only provide mixed support for the EKC hypothesis. Specifically, we find evidence of an EKC for nine of the 20 countries, with five exhibiting a traditional inverted U-shaped relationship, three exhibiting an N-shaped relationship and one, an inverted N-shaped relationship.
•We test the Environmental Kuznets Curve (EKC) hypothesis for OECD nations.•We use data that dates back to the first globalization boom in the nineteenth century.•Our estimators account for cross-sectional dependence and parameter heterogeneity.•We find support for the EKC hypothesis for the panel as a whole.•Country-specific results provide mixed support for the EKC hypothesis.
This article models the endogenously interrelated relationship between global economic policy uncertainty (EPU), world industrial production (WIP), and the demand for US tourism net export (TNX) ...expenditures. To do so, we apply an identified structural vector autoregression model over monthly data spanning from January 1999 to October 2020. Our findings reveal that a positive shock in WIP has a significant positive effect on demand for TNXs. In contrast, unanticipated increases in price and EPU have a statistically significant negative effect on TNXs. Our results show that, in the long run, a one standard deviation shock in global EPU explains about 26.05% of the variations in tourism net service exports.
An extensive number of studies uses trade-to-GDP as a proxy for globalisation in environmental research. Globalisation encompasses much more than just trade in goods. Globalisation is the integration ...of various countries and includes spillovers of ideas and technology, financial flows, the worldwide movement of labour, and national governments meeting on an international level in a bid to solve social and political problems. This study considers the effect of globalisation on carbon dioxide emissions by using a more flexible and comprehensive measure based on the KOF globalisation index for a panel of 21 OECD nations covering the period 1970–2014. Since the globalisation process is not uniform across countries and time, we use a fully-fledged nonparametric technique to estimate the time-varying coefficient and trend functions. Our results show that the effect of globalization on CO
2
emissions is positive up until 2000, then switches to turns negative thereafter.
We employ the recently developed LM and RALS-LM unit root tests that allow for endogenously determined structural breaks to study stochastic convergence in relative per capita CO2 emissions over the ...period 1921 to 2014 for a balanced panel of emerging market economies. The results provide mixed evidence of the presence of stochastic convergence. In particular, stochastic convergence is achieved for eleven out of the seventeen countries under investigation. This implies that the energy regulatory framework in these countries needs to be revaluated in order to reduce the carbon footprint. To further comprehend the factors behind the observed disparities in emission stability, we analyse the determinants of the identified groups. An examination of the determinants of the observed behaviour in relative per capita CO2 emissions reveal that income, population, financial development and trade are significant drivers, with trade predominantly playing a larger role in emission growth. Also, weak evidence is found in terms of a catching-up effect in the growth of relative per capita CO2 emissions.
•We study stochastic convergence in relative per capita CO2 emissions.•We use a balanced panel of emerging market economies over the period 1921 to 2014.•We employ the recently developed LM and RALS-LM unit root tests.•The results provide mixed evidence of the presence of stochastic convergence.
We employ the Phillips and Sul (Econometrica 75(6):1771–1855, 2007) methodology to test for the convergence of healthcare expenditure across Australian states and territories. We utilise a nonlinear ...model that allows for heterogeneity and transitional dynamics and consider the convergence patterns of total, government and non-government healthcare expenditures. The results display varying degrees of convergence, specifically in government and non-government expenditures. The formation of convergence and non-convergence clusters suggests that health policies need not be uniform across all Australian states and territories but within convergent clubs. As a result, healthcare policies need to be implemented at the state level rather than at the national level.
Using a historical data set and recent advances in non-parametric time series modelling, we investigate the nexus between tourism flows and house prices in Germany over nearly 150 years. We use ...time-varying non-parametric techniques given that historical data tend to exhibit abrupt changes and other forms of non-linearities. Our findings show evidence of a time-varying effect of tourism flows on house prices, although with mixed effects. The pre-World War II time-varying estimates of tourism show both positive and negative effects on house prices. While changes in tourism flows contribute to increasing housing prices over the post-1950 period, this is short-lived, and the effect declines until the mid-1990s. However, we find a positive and significant relationship after 2000, where the impact of tourism on house prices becomes more pronounced in recent years.
We replicate, and extend, Zerbo and Darné's (2019) study examining the stationarity properties of per capita carbon dioxide (CO2) emissions in the OECD from 1960 to 2014. We first replicate by ...reproduction their main findings for 25 OECD countries by applying their methods over the same time period that they consider. We then extend the analysis to examine whether CO2 emissions are stationary in those 25 OECD countries from 1860 to 2014. We confirm Zerbo and Darné's (2019) main conclusion that historical events have induced changes in the trend function of the series and that emission levels are characterized by a non-stationary process. Using a longer timeframe also provides additional insights. Results from unit root testing suggest that not only more recent events, such as the first oil price shock, as highlighted by Zerbo and Darné (2019), but the Long Depression of the nineteenth century, the Great Depression and the two world wars have induced changes in the slope of the series.
•We replicate, and extend, Zerbo and Darné's (2019) study.•We examine the stationarity properties of CO2 emissions in the OECD.•We focus on 25 OECD countries from 1860 to 2014.•Historical events have induced changes in the trend function of the series.•Emission levels are characterized by a non-stationary process.
This paper investigates stochastic convergence in income inequality across Australian states and territories since the end of World War II by utilising the LM and RALS-LM unit root tests that allow ...for endogenously determined structural breaks. We find that income inequality for Australia’s capital city—the Australain Capital Territoy—converges to a stable steady-state when we account for endogenously determined trend-breaks. The null hypothesis of a unit root is rejected when utilising the two-break unit root test for New South Wales, Northern Territory, Queensland, South Australia, Tasmania and Western Australia indicating that income inequalities in these states converge to a stable steady-state when accounting for multiple structural breaks. In contrast, the state of Victoria consistently shows evidence of divergence regardless of the number of endogenously determined structural breaks. Structural changes in income inequality across states and territories may be linked to the mining boom, the transition from manufacturing to a service-based economy, changes in government welfare, and favourable changes in tax policies and superannuation.
