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Remittances and CO2 emissions in Jamaica: An asymmetric modified environmental kuznets curve

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  • Brown, Leanora
  • McFarlane, Adian
  • Campbell, Kaycea
  • Das, Anupam

Abstract

The original environmental Kuznets curve (EKC) proposes that environmental degradation increases with economic growth up to a maximum and then decreases thereafter, in an inverted U-shaped pattern. Departing from a discussion of the EKC, we consider a modified version wherein the relationship is between carbon dioxide (CO2) emissions and remittance inflows. We then apply autoregressive distributed lag bounds testing techniques to Jamaican data over the period 1976–2014 to elucidate the causal relationship between these variables, a first for this nation. Of note, we consider the potential existence of asymmetries in this relationship. There are two central findings. First, on a per capita basis, there is a long run cointegrating relationship running from remittances to CO2. This relationship exhibits an inverted U-shaped pattern like that of the traditional EKC. Second, we find that there exists statistically significant evidence of an asymmetric response of CO2 to changes in remittances only in the short run. One important implication of our findings is that the Jamaican government should design programs that incentivize consumers and investors to use remittances to make environmentally friendly purchases.

Suggested Citation

  • Brown, Leanora & McFarlane, Adian & Campbell, Kaycea & Das, Anupam, 2020. "Remittances and CO2 emissions in Jamaica: An asymmetric modified environmental kuznets curve," The Journal of Economic Asymmetries, Elsevier, vol. 22(C).
  • Handle: RePEc:eee:joecas:v:22:y:2020:i:c:s170349492030013x
    DOI: 10.1016/j.jeca.2020.e00166
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    6. Usama Al-Mulali & Hassan F. Gholipour & Sakiru Adebola Solarin, 2022. "Investigating the environmental Kuznets curve (EKC) hypothesis: does government effectiveness matter? Evidence from 170 countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(11), pages 12740-12755, November.
    7. Ahmad, Waheed & Ozturk, Ilhan & Majeed, Muhammad Tariq, 2022. "How do remittances affect environmental sustainability in Pakistan? Evidence from NARDL approach," Energy, Elsevier, vol. 243(C).
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    11. Das, Anupam & Brown, Leanora & Mcfarlane, Adian, 2023. "Economic Misery and Remittances in Jamaica," Journal of Economic Development, The Economic Research Institute, Chung-Ang University, vol. 48(2), pages 33-52, June.
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    More about this item

    Keywords

    Remittances; CO2 emissions; Modified EKC; ARDL; NARDL;
    All these keywords.

    JEL classification:

    • F62 - International Economics - - Economic Impacts of Globalization - - - Macroeconomic Impacts
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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