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http://dx.doi.org/10.15266/KEREA.2014.23.3.473

Time-Varying Income Elasticity of CO2 emission Using Non-Linear Cointegration  

Lee, Sungro (Center for Gas and Economics & Management, Korea Gas Corporation)
Kim, Hyo-Sun (Center for Gas and Economics & Management, Korea Gas Corporation)
Publication Information
Environmental and Resource Economics Review / v.23, no.3, 2014 , pp. 473-496 More about this Journal
Abstract
This paper intends to test the non-linear relationship between $CO_2$ emissions and income by employing cointegration model of the time-varying income elasticity. We select France, UK, Italy, Japan, US, China, India, Mexico and Korea and use non-parametric time series analysis on each country in order to estimate its own effect of income on $CO_2$ emission. The main results indicate that the $CO_2$ emission-income elasticities vary over time and the income elasticities of the Annex I countries tend to be higher in absolute terms than those of developing countries. In addition, we find that emission-income elasticities decrease for Annex I countries over time, whereas those for developing countries increase.
Keywords
$CO_2$ emission; Cointegrating model with time-varying coefficient; Environmental Kuznets curve;
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