INVESTIGATING THE N-SHAPED ENERGY-ENVIRONMENTAL KUZNETS CURVE HYPOTHESIS IN SAUDI ARABIA

Haider Mahmood,Maham Furqan,Muhammad Tanveer

doi:10.32479/ijeep.11573

Abstract

The Environmental Kuznets Curve (EKC) is extensively investigated in the literature, but testing of energy-EKC is scarce in the literature. The testing of energy-EKC is very important for extensive nonrenewable energy users. This research investigated the energy and growth cubic relationship in Saudi Arabia to verify the N-shaped energy EKC from 1970-2019. The estimated long-run parameters of linear, quadratic, and cubic terms of economic growth are found positive, negative, and positive, respectively. Hence, energy-EKC is corroborated in Saudi Arabia in the long run with the first turning point of N-curve at Gross Domestic Product (GDP) per capita of 19277 constant US dollar and the second point at 30880. Hence, the increasing GDP per capita before 19277 and after 30880 would increase energy use and have environmental consequences. The increasing GDP per capita between 19277 and 30880 would decrease energy consumption and is pleasant for the environment. The same behavior of energy usage is found in the short run. Hence, the energy-EKC is also validated in the short run. Keywords: The energy EKC, energy consumption, economic growth, cointegrationJEL Classifications: Q42, O44, C22 DOI: https://doi.org/10.32479/ijeep.11573

Highlights

The environmental effects of energy use and growth are well explored in the energy and environmental literature through the Environmental Kuznets Curve (EKC)
Environmental consequences of economic growth might be more dangerous for the countries, heavily depending on fossil fuels
Long run energy-EKC is corroborated in Saudi Arabia

Summary

INTRODUCTION

The environmental effects of energy use and growth are well explored in the energy and environmental literature through the Environmental Kuznets Curve (EKC). LITERATURE REVIEW four large polluter economies from 1970 to 2012 They found that energy use and income increased the emissions in all countries. Saudi et al (2019) investigated the EKC in Malaysia from 1980 to 2017 and corroborated the EKC They found that innovation and REC helped to reduce emissions, and non-REC accelerated the emissions. In testing the EKC in Saudi Arabia, literature has explored the relationship between emissions and growth. Mahmood and Alanzi (2020) argued that Saudi Arabia targeted to reduce fossil fuel dependence They investigated the income and emissions relationship in Saudi Arabia, controlling the rules of law in the model from 1996 to 2014. We contribute to the energy-EKC literature of the Saudi economy by inspecting the cubic relationship

METHODS

DATA ANALYSES

CONCLUSION