The Role of the Globalisation Process in Mitigating Carbon Dioxide Emissions in Latin American and Caribbean Countries

Abstract

AbstractThis chapter analyses the impact of globalisation on carbon dioxide emissions in the panel data of 13 Latin American and the Caribbean (LAC) countries from 1991 to 2012. A panel autoregressive distributed lag (PARDL) methodology was used to decompose the total effects of globalisation on carbon dioxide emissions in short- and long-run components. There is evidence that globalisation contributes to reducing carbon dioxide emissions in the long run. A possible explanation of this result is that the process of globalisation causes technological enhancement in LAC countries, which contributes to a decrease in environmental degradation. However, globalisation has other implications, such as the transfer of responsibility from the state to the private sector, where this transfer corresponds to the shifting of regulatory attributes to independent governmental regulatory authorities, in other words, “regulation for competition”.KeywordsEnergy economicsEconometricsFossil fuelsLatin American and the CaribbeanMacroeconomicsTrade opennessJEL CodesE6F1Q40Q43