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Testing the environmental Kuznets curve hypothesis: the role of energy consumption and democratic accountability

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Abstract

Considering the role democratic structures play in shaping the policies that enhance environmental quality, this paper tests the environmental Kuznets curve (EKC) hypothesis by incorporating the role of energy consumption and democratic accountability for nine countries between 1990 and 2014. The pooled mean group (PMG) methodology and Emirmahmutoglu-Kose Granger causality test are employed. The empirical results validate the EKC hypothesis in the long run. The results also confirm that energy consumption significantly increases CO2 emissions in the long run and short run, while democratic accountability significantly reduces CO2 emissions in the long run. Causality test results indicate a two-way causal relationship between democratic accountability and economic growth, and also between energy consumption and economic growth. The study recommends among others, the need to strengthen democratic accountability and improve access to information that protects the environment.

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Notes

  1. https://pomed.org/wp-content/uploads/2019/12/191210_Algeria_ExpertQA.pdf and https://insamer.com/en/the-crisis-of-democracy-in-algeria-why-was-the-arab-spring-stumbled-there_1581.html

  2. https://jacobinmag.com/2019/11/sri-lanka-mahinda-rajapaksa-regime

  3. https://www.brookings.edu/research/the-rise-and-fall-of-liberal-democracy-in-turkey-implications-for-the-west/

  4. Democratic accountability is measured on 6-point scale with highest number of risk points representing lowest risk, which is assigned to perfect democracy and lowest number of risk points representing highest risk, which is assigned to autarchy. To ensure easy and robust interpretations, we rescaled the variable by taking the inverse so that the higher number of risk will represent higher risk and the lower number of risk will represent lower risk

Abbreviations

CO2 :

Carbon dioxide

DEMO:

Democratic accountability 

EC:

Energy consumption

ECM:

Error correction model

ECT:

Error correction term

EKC:

Environmental Kuznets curve

GDP:

Gross domestic product

MG:

Mean group (MG)

PMG:

Pooled mean group (PMG)

VECM:

Vector error correction model

Y :

Income

Y 2 :

Income squared

DHp:

Durbin-Hausman cointegration panel test

FE-OLS:

Fixed effect-ordinary least squares

MWALD:

Modified Wald

LA-VAR:

Lag augmented VAR

VAR:

Vector autoregression

ED:

Environmental degradation

ARDL:

Autoregressive distributed lag

CD:

Cross-sectional dependence

LM:

Lagrange multiplier

CIPS:

Cross-sectional Im, Pesaran, and Shin

CADF:

Cross-sectional augmented Dickey Fuller

DHg:

Durbin-Hausman cointegration group mean

→:

Direction of causality

FGLS:

Feasible generalized least squares

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Acknowledgments

We appreciate Prof. Mehmet Balcilar who provided us with the data on democratic accountability index and for his useful suggestions, which helped to improve the paper.

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Authors and Affiliations

  1. Department of Economics, Eastern Mediterranean University, North Cyprus via Mersin 10, Famagusta, Turkey

    Hasan Güngör

  2. Department of Economics, Adeyemi College of Education Ondo, Ondo, Nigeria

    Ifedolapo Olabisi Olanipekun

  3. School of Business Education, Federal College of Education (Technical), Potiskum, Nigeria

    Ojonugwa Usman

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  1. Hasan Güngör
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  2. Ifedolapo Olabisi Olanipekun
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  3. Ojonugwa Usman
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Correspondence to Ifedolapo Olabisi Olanipekun.

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Güngör, H., Olanipekun, I.O. & Usman, O. Testing the environmental Kuznets curve hypothesis: the role of energy consumption and democratic accountability. Environ Sci Pollut Res 28, 1464–1478 (2021). https://doi.org/10.1007/s11356-020-10317-x

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