Chapter 2 - Does transport infrastructure development contribute to carbon emissions? Evidence from developing countries

Abstract

This study employed the IV-GMM to investigate the impact of air and rail transport infrastructure on the emissions of CO2 in 113 developing countries for the time between 1990 and 2018. Our study established that both air and rail transport infrastructure contribute directly to higher carbon emissions. Indirectly, it was observed that the moderation effect between air transport infrastructure and GDP per capita does not significantly impact on carbon emissions while rail transport infrastructure moderates GDP per capita to worsen carbon emissions. Also, air and rail transport infrastructure moderate energy consumption to reduce the emissions of CO2 in less advanced countries. It was further revealed that the environmental Kuznets curve hypothesis does not exist in developing countries. In addition, population, energy consumption, trade openness, urbanization, energy consumption, and financial development worsen carbon emissions while foreign direct investment (FDI) mitigates carbon emissions in the developing countries. These results differ across countries at different stages of economic development. The policy ramifications of these findings for developing countries are discussed.