Abstract
The paper investigated cross-cutting issues relating to renewable energy, carbon-emission and economic growth for a group of 8 MENA countries covering the period 1990-2018. Adopting a modified linear Cobb-Douglas production function, the study adopted the Fully-Modified and the Dynamic OLS estimation technique in examining the aforementioned relationship. Findings from the panel FMOLS and DOLS for the region confirm that a significant relationship exists between CO2 emission and economic growth and that renewable energy consumption triggers a significant effect on economic growth as well. Conversely, the panel of the FMOLS result reveals that while economic growth reacts positively from the effect of CO2 emission, CO2 emission reacts negatively from the effect of renewable energy consumption, as against the positive outcome between renewable energy consumption and CO2 emission as reported by the DOLS. This goes to point out that most economies within this region are yet to uncover best and appropriate policies which can control the regulation of renewable energy prices, that can help take into consideration the stability in economic growth structure and at the same time, mitigate the emission of Greenhouse Gases (GHG).
Highlights
The paper investigated cross-cutting issues relating to renewable energy, carbon-emission and economic growth for a group of 8 Middle East and North Africa (MENA) countries covering the period 1990-2018
The results showed that the Environmental Kuznets Curve (EKC) hypothesis is validated and that increasing economic growth in Algeria has increased emissions
Data used are for the variables per capita GDP, a proxy for economic growth, CO2 emission per capita and renewable energy consumption (REW), expressed as the share of consumption from renewable energy sources in total final energy
Summary
The paper investigated cross-cutting issues relating to renewable energy, carbon-emission and economic growth for a group of 8 MENA countries covering the period 1990-2018. The associated environmental problems are aggravated through heavy subsidies on petroleum products which promote excessive and inefficient use of fossilfuels (Farzanegan and Markwardt, 2012) In this perspective, energy subsidies in the 20 largest non-OECD countries stretched to ($ 310*1012) in 2007. The MENA region dependence on oil and gas, as well as their energy-intensive industrial projects which promote the use of domestically produced hydrocarbons; has left an ineffaceable mark on the region’s carbon footprint. These problems have significantly risen since the 1960s side-by-side rapid rates of energy-intensive industrialization, urbanization and rising living standards (World Bank, 2016)
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