Examining the Convergence Hypothesis in Energy Consumption, CO2 Emissions and Carbonization Index. Evidence from EU Countries.

Abstract

As the consumption of energy is responsible for approximately, 80% of GHG in EU, the impact of energy activity on the environment has received increasing attention over the last decades from scholars, researchers, politicians and society as a whole. Within EU member countries it is commonly accepted that the design of energy and mitigation policies either at national or at European level require a detailed and integrated investigation of convergence-divergence pattern amongst the participating countries. In this paper, we examine the distribution dynamics of energy consumption and CO2 emissions per capita, their intensities as well as the carbonization index in 25 European countries over a forty one year period, in particular from 1970-2010. For this purpose we used Quah's methodology which is based on the dynamics of cross-section distributions. The main conclusion is that for all the examined variables the hypothesis of convergence patterns for the EU sample is not valid. Moreover, regarding each examined variable different groups of polarization established. Our analysis provides strong evidence supporting the fact that national and European energy and mitigation policies should be implemented according to the non-convergence paradigm. The body of evidence provided by our analysis is of great importance to energy policy makers and to issues related to climate change.

Keywords: European countries, convergence, energy consumption, carbonization index GHGs

JEL Classification: O13, O47, O5, Q43