Causality of CO2 Emissions, Energy Consumption, Renewable Energy on Economic Growth in Asia Case Studies of 6 Asian Countries

Abstract

This research was conducted to examine the relationship and influence between CO2 emission variables, energy consumption, and renewable energy on economic growth in 6 countries in the Asia Pacific region, namely Indonesia, Thailand, Malaysia, Japan, China, and South Korea. These countries have different levels of economic growth. Economic activities carried out in each country produce different externalities. Therefore, this research was conducted to examine the relationship between CO2 emissions, energy consumption, renewable energy, and economic growth in 2014- 2020. The data used in this study were obtained from the World Bank and the Statistical Review of World Energy. The research was conducted using the panel data regression method with the fixed effect model (FEM) as the best model. The results of this study indicate that renewable energy, total energy consumption, and CO2 emissions have a significant effect on economic growth. Meanwhile, per capita energy consumption variable has no significant effect on economic growth. From the R-square value, all variables have a correlation of 99% and as much as 1% is explained by variables outside the study. Further suggestions from this research are the government and related agencies regarding environmental sustainability issues due to CO2 emissions which continue to increase energy consumption and is believed to hamper economic growth in 6 Asian countries.
 Keywords: consumption of energy, emission CO2, economic growth, panel data regression, renewable energy