The spatial spillover effects of energy transition and trade openness on CO2 emissions

Abstract

This study explores the spatial effects of energy transition and trade openness on CO2 emissions from 1990 to 2019 in 75 BRI countries. We use the spatial panel data models to address spatial dependency and the spillover impact between adjacent countries. First, the estimated findings support the occurrence of spatial autocorrelations in CO2 emissions across BRI countries. Second, we find that trade openness, natural gas consumption, and these variables' spatial effects positively affect CO2 emissions. Hence, renewable energy consumption and its spatial effect are negatively significant on CO2 emissions, while the GDP and its spatial effect are positive and negative, respectively. This study provides robust policy implications for promoting a green economy, CO2 reduction legislation, renewable energy, and the eventual replacement of natural gas.