Co2 Emissions and GDP: Evidence from China

28 Pages Posted: 23 Oct 2019

See all articles by Guglielmo Maria Caporale

Guglielmo Maria Caporale

Brunel University London - Department of Economics and Finance; London South Bank University; CESifo (Center for Economic Studies and Ifo Institute); German Institute for Economic Research (DIW Berlin)

Gloria Claudio-Quiroga

Francisco de Vitoria University

Luis A. Gil-Alana

University of Navarra - Department of Economics

Date Written: 2019

Abstract

This paper examines the relationship between the logarithms of CO2 emissions and real GDP in China by applying fractional integration and cointegration methods. The univariate results indicate that the two series are highly persistent, their orders of integration being around 2, whilst the cointegration tests (using both standard and fractional techniques) imply that there exists a long-run equilibrium relationship between the two variables in first differences, i.e. their growth rates are linked together in the long run. This suggests the need for environmental policies aimed at reducing emissions during periods of economic growth.

Keywords: CO2 emissions, GDP, China, persistence, fractional integration, fractional cointegration

JEL Classification: C220, C320, Q560

Suggested Citation

Caporale, Guglielmo Maria and Claudio-Quiroga, Gloria and Gil-Alana, Luis A., Co2 Emissions and GDP: Evidence from China (2019). CESifo Working Paper No. 7881. Available at SSRN: https://ssrn.com/abstract=3473597

Guglielmo Maria Caporale (Contact Author)

Brunel University London - Department of Economics and Finance ( email )

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HOME PAGE: http://www.brunel.ac.uk/about/acad/bbs/bbsstaff/ef_staff/guglielmocaporale/

London South Bank University ( email )

Centre for Monetary and Financial Economics
London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstra├če 58
Berlin, 10117
Germany

Gloria Claudio-Quiroga

Francisco de Vitoria University

Spain

Luis A. Gil-Alana

University of Navarra - Department of Economics ( email )

Campus de Arrosadia
Pamplona, 31006
Spain

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