The Effects of Economic Growth on the Relationship Between Energy Consumption and Pollution in D8 Countries: Panel Smooth Transition Regression Approach (PSTR)

Document Type : Original Article

Authors

1 Assist. Profe. Department of Economics, Faculty of Economics and Management, Urmia University, Urmia, Iran

2 PhD Student in Economics, Department of Economics, Faculty of Economics and Management, Urmia University, Urmia, Iran

Abstract

The purpose of this study is to investigate The Threshold Effect of Economic Growth on the Relationship between Energy Consumption and environment Pollution in D8 Countries during the period 1990-2015. The panel smooth transition regression model (PSTR) is used for this purpose that is well proper for heterogeneous panel data. The Economic Growth used as the transition variable. The results show that there is a non-linear relationship between the explanatory variables and the dependent variable and relationship between energy consumption, population, Industry value added and co2 emissions indirectly is affected by Economic Growth. Estimated threshold value of transition variable is equal 8.3418 and the slope parameter is equal 21.4942 that contain only one transition function and only one threshold value. In the first regime, Energy consumption, population and Industry value added have a positive impact on co2 emissions. In the second regime that the amount of Economic Growth is greater than threshold value, positive impact of population on dependent variable has been intensified. In this regime the effect of Energy consumption and Industry value added on co2 emissions is positive but its impact is less than before.
 

Keywords


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