Chapter Six - Energy–growth nexus, domestic credit, and environmental sustainability: a panel causality analysis

Abstract

The focus of this study goes beyond capturing the relationship between carbon dioxide emissions and economic growth. Through a Panel Vector Autoregressive and bivariate analysis, we integrated domestic credit to verify its effect on the nexus. We selected 19 high-income countries. The criterion of choice was motivated for countries where there was no break in the time series. The data used was comprised of information from 2001 to 2016. The result of the Granger causality test allowed the verification of the causal relationships between the several variables of the model. The bivariate relationships between the variables of the estimation (pairwise) were also presented. The study also draws the attention of regulators to the integration of financial public sector policies and environmental sustainability.