IDEAS home Printed from https://ideas.repec.org/a/eco/journ2/2020-03-44.html
   My bibliography  Save this article

Causal Modeling of the Effect of Foreign Direct Investment, Industry Growth and Energy Use to Carbon Dioxide Emissions

Author

Listed:
  • Warsono Warsono

    (Department of Mathematics, Faculty of Science and Mathematics, Universitas Lampung, Indonesia,)

  • Edwin Russel

    (Department of Management, Faculty of Economics and Business, Universitas Lampung, Indonesia,)

  • Wamiliana Wamiliana

    (Department of Mathematics, Faculty of Science and Mathematics, Universitas Lampung, Indonesia,)

  • Mustofa Usman

    (Department of Mathematics, Faculty of Science and Mathematics, Universitas Lampung, Indonesia,)

  • Widiarti Widiarti

    (Department of Mathematics, Faculty of Science and Mathematics, Universitas Lampung, Indonesia,)

  • Faiz Ahmed M. Elfaki

    (Department of Mathematics, Statistics and Physics, College of Art and Sciences, Qatar University, Qatar.)

Abstract

Application of path analysis for causal modeling has been widely used in many areas of studies, such as in social science, education, biology, medical, sociology, and economics. In this study, path analysis is applied to test a relationship model among variables: Foreign direct investment (FDI), industry growth (IND), energy use (ENR), and carbon dioxide (CO2) emissions. Aims of this study are to know whether there exist direct effect of FDI to IND, direct effect of FDI and IND to ENR, and direct effect of IND and ENR to CO2 emissions. Results of analysis show that there is a direct effect of FDI to IND where the effect is determined as 0.3597; parameter estimate is significant and meaningfulness. There is direct effect of FDI and IND to ENR. Effect of FDI to ENR is identified as 0.2736; parameter estimate is not significant, but the value is still meaningfulness. Direct effect of IND to ENR is -0.4975; parameter estimate is very significant. There is a direct effect of IND and ENR to CO2 emissions. Effect of IND to CO2 emissions is 0.0557; parameter estimate is not significant, but the value is still meaningfulness. Direct effect of ENR to CO2 emissions is 0.9597 where parameter estimate is very significant and meaningfulness.

Suggested Citation

  • Warsono Warsono & Edwin Russel & Wamiliana Wamiliana & Mustofa Usman & Widiarti Widiarti & Faiz Ahmed M. Elfaki, 2020. "Causal Modeling of the Effect of Foreign Direct Investment, Industry Growth and Energy Use to Carbon Dioxide Emissions," International Journal of Energy Economics and Policy, Econjournals, vol. 10(3), pages 348-354.
    • Handle: RePEc:eco:journ2:2020-03-44
    as

    Download full text from publisher

    File URL: https://www.econjournals.com/index.php/ijeep/article/download/8528/5033
    Download Restriction: no
    File URL: https://www.econjournals.com/index.php/ijeep/article/view/8528/5033
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Hoesung Lee & Ji-Chul Ryu, 1991. "Energy and CO2 emissions in Korea : Long-term scenarios and related policies," Energy Policy, Elsevier, vol. 19(10), pages 926-933, December.
    2. K. J. Noorman & K. J. Kamminga, 1998. "Reducing residential energy use for a sustainable future: fossil fuel taxation as a tool to reduce the indirect energy demand and related CO 2 emissions of Dutch households," Sustainable Development, John Wiley & Sons, Ltd., vol. 6(3), pages 143-153.
    3. Knapp, Tom & Mookerjee, Rajen, 1996. "Population growth and global CO2 emissions : A secular perspective," Energy Policy, Elsevier, vol. 24(1), pages 31-37, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Vikniswari Vija Kumaran & Siti Nurul Munawwarah & Mohd Khairi Ismail, 2021. "Sustainability in ASEAN: The Roles of Financial Development towards Climate Change," Asian Journal of Economics and Empirical Research, Asian Online Journal Publishing Group, vol. 8(1), pages 1-9.
    2. Stefan Niederhafner, 2014. "The Korean Energy and GHG Target Management System: An Alternative to Kyoto-Protocol Emissions Trading Systems?," TEMEP Discussion Papers 2014118, Seoul National University; Technology Management, Economics, and Policy Program (TEMEP), revised Sep 2014.
    3. Al Mamun, Md. & Sohag, Kazi & Hannan Mia, Md. Abdul & Salah Uddin, Gazi & Ozturk, Ilhan, 2014. "Regional differences in the dynamic linkage between CO2 emissions, sectoral output and economic growth," Renewable and Sustainable Energy Reviews, Elsevier, vol. 38(C), pages 1-11.
    4. Fernando Ramos-Quintana & Efraín Tovar-Sánchez & Hugo Saldarriaga-Noreña & Héctor Sotelo-Nava & Juan Paulo Sánchez-Hernández & María-Luisa Castrejón-Godínez, 2019. "A CBR–AHP Hybrid Method to Support the Decision-Making Process in the Selection of Environmental Management Actions," Sustainability, MDPI, vol. 11(20), pages 1-30, October.
    5. Qi, Wei & Li, Guangdong, 2020. "Residential carbon emission embedded in China's inter-provincial population migration," Energy Policy, Elsevier, vol. 136(C).
    6. Zeng, Qingshun & Shi, Changfeng & Zhu, Wenjun & Zhi, Jiaqi & Na, Xiaohong, 2023. "Sequential data-driven carbon peaking path simulation research of the Yangtze River Delta urban agglomeration based on semantic mining and heuristic algorithm optimization," Energy, Elsevier, vol. 285(C).
    7. Samar Khairy Ghanem, 2018. "The relationship between population and the environment and its impact on sustainable development in Egypt using a multi-equation model," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 20(1), pages 305-342, February.
    8. Xiao, Huijuan & Duan, Zhiyuan & Zhou, Ya & Zhang, Ning & Shan, Yuli & Lin, Xiyan & Liu, Guosheng, 2019. "CO2 emission patterns in shrinking and growing cities: A case study of Northeast China and the Yangtze River Delta," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    9. Sung-In Na, 2000. "Input-output analysis of CO2 emissions for the industrial sector in Korea," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 3(3), pages 311-333, September.
    10. Bowen Da & Chuanzhe Liu & Nana Liu & Sidun Fan, 2021. "Strategies of Two-Level Green Technology Investments for Coal Supply Chain under Different Dominant Modes," Sustainability, MDPI, vol. 13(7), pages 1-24, March.
    11. Wang, Zhaohua & Yin, Fangchao & Zhang, Yixiang & Zhang, Xian, 2012. "An empirical research on the influencing factors of regional CO2 emissions: Evidence from Beijing city, China," Applied Energy, Elsevier, vol. 100(C), pages 277-284.
    12. Sung-In Na, 2000. "Input-output analysis of CO 2 emissions for the industrial sector in Korea," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 3(3), pages 311-333, September.
    13. Song Wang & Yixiao Wang & Chenxin Zhou & Xueli Wang, 2022. "Projections in Various Scenarios and the Impact of Economy, Population, and Technology for Regional Emission Peak and Carbon Neutrality in China," IJERPH, MDPI, vol. 19(19), pages 1-31, September.
    14. Tianyi Zeng & Hong Jin & Xu Gang & Zihang Kang & Jiayi Luan, 2022. "County Economy, Population, Construction Land, and Carbon Intensity in a Shrinkage Scenario," Sustainability, MDPI, vol. 14(17), pages 1-16, August.
    15. Yuhao Lu & Nicholas C Coops, 2018. "Bright lights, big city: Causal effects of population and GDP on urban brightness," PLOS ONE, Public Library of Science, vol. 13(7), pages 1-15, July.
    16. Chen, Jiandong & Wang, Ping & Cui, Lianbiao & Huang, Shuo & Song, Malin, 2018. "Decomposition and decoupling analysis of CO2 emissions in OECD," Applied Energy, Elsevier, vol. 231(C), pages 937-950.
    17. Zhang, Chuanguo & Tan, Zheng, 2016. "The relationships between population factors and China's carbon emissions: Does population aging matter?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 65(C), pages 1018-1025.
    18. Shijing Nan & Zhaomin Wang & Jinwei Wang & Jianluan Wu, 2022. "Investigating the Role of Green Innovation in Economic Growth and Carbon Emissions Nexus for China: New Evidence Based on the PSTR Model," Sustainability, MDPI, vol. 14(24), pages 1-19, December.
    19. Mazzarino, Marco, 2000. "The economics of the greenhouse effect: evaluating the climate change impact due to the transport sector in Italy," Energy Policy, Elsevier, vol. 28(13), pages 957-966, November.
    20. Xin Tong & Xuesen Li & Lin Tong & Xuan Jiang, 2018. "Spatial Spillover and the Influencing Factors Relating to Provincial Carbon Emissions in China Based on the Spatial Panel Data Model," Sustainability, MDPI, vol. 10(12), pages 1-17, December.

    More about this item

    Keywords

    path analysis; decomposition of correlation; direct effect; indirect effect; total effect;
    All these keywords.

    JEL classification:

    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eco:journ2:2020-03-44. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ilhan Ozturk (email available below). General contact details of provider: http://www.econjournals.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.