Population Density, Economic Growth, Energy Consumption and CO2 Emissions: Empirical Evidence from Asia-Pacific Countries

Abstract

Energy is the main source of CO2 emissions, which is the key factor of the environmental pollution increasing everywhere around the world. The connection between energy consumption, economic growth, population density and CO2 emissions are an issue that needs to be analyzed in a multidisciplinary and scholarly manner. In this study, the connection between energy consumption, economic growth, population density and CO2 emissions were analyzed empirically on the basis of 14 Asian-Pacific countries. A series of panel data models and a balanced panel data set were used in the study which covered the period between 1971 and 2017. The results of the cointegration test for the panel showed that there was a cointegration relationship between the variables. According to the results of the Panel VECM granger causality test, there is evidence of a two-way causality relationship between CO2 emissions and economic growth, and between energy consumption and economic growth. In addition, population density is the causality of energy consumption, and population density is the causality of economic growth. According to the results, countries need to turn to cleaner energy sources to reduce CO2 emissions.