Causal interactions between environmental degradation, renewable energy, nuclear energy and real GDP: a dynamic panel data approach

Abstract

Renewable energy as well as nuclear energy are low carbon power that presents the life cycle emissions of greenhouse gases than fossil fuel energy. However, analyzing the relationship between the consumption of renewable energy, consumption of nuclear energy, CO2 emissions and economic growth is crucial for the economic and energy policy decision; we address this question for developed countries. This paper deals with the relationships between nuclear energy, environmental degradation, real GDP and renewable energy. We apply a panel data model for a global panel consisting of nine developed countries during the period 1990–2013. The group studied consists of Canada, France, Japan, Netherlands, Spain, Sweden, Switzerland, UK and the USA. The empirical findings suggest that: (1) a causal link between emissions and real income, (2) a unidirectional causality running from renewable energy to nuclear energy, (3) a unidirectional causal relationship running from capital to environmental degradation, (4) a unidirectional causal relationship running from income to nuclear energy consumption, since the growth hypothesis is valid, (5) a unidirectional causality running from capital to income, (6) no an outstanding role of renewable energy use in the contribution of CO2 emissions.