Dynamic impacts of energy efficiency, economic growth, and renewable energy consumption on carbon emissions: Evidence from Markov Switching model

Abstract

The intent of this study was to find out the short and long-term structural effects of energy efficiency, economic growth, and the use of renewable energy resources on carbon emissions in Thailand. We determined to use the Markov Switching ADRL model for the investigation because this method enables us to deal with the incorrect spurious short-run regression issues without the need to modify the data to attain stationarity. To predict the long-run relationship and the rate of adjustment to equilibrium, we use the error correction factor. The results of the investigation showed the presence of both short-run and long-run structural changes. It is interesting that under the two regimes, the impacts of economic growth, energy efficiency, and renewable energy use on carbon emissions are asymmetric. Because both regimes' rates of adjustment are significant and less than zero and will eventually lead to the attainment of equilibrium.