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How does geopolitical risk affect carbon emissions?: An empirical study from the perspective of mineral resources extraction in OECD countries

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  • Ding, Tao
  • Li, Hao
  • Tan, Ruipeng
  • Zhao, Xin

Abstract

Faced with the severe climate change situation, the major economies of the world have gradually developed carbon reduction strategies to combat climate change. Mineral resources security has become a hot issue because of the frequent occurrence of geopolitical risk (GPR) events, which will further have an inevitable impact on carbon dioxide (CO2) emissions. However, there is little empirical evidence to support the issue. This paper explores the impact of GPR on CO2 emissions in OECD countries from the perspective of mineral resources extraction. The panel data from 25 OECD countries in the period of 1990–2019 is applied in the empirical study. Three primary conclusions are obtained using panel fixed-effects (FE) model and panel quantile model. First, GPR increases CO2 emissions in OECD countries. Second, the positive impact of GPR is heterogeneous. Third, the positive impact on CO2 emissions occurs mainly due to the exacerbated risks of mineral resources. Increased GPR inhibits the improvement of energy structure and promotes fuel imports, which further increase CO2 emissions. Finally, we provide some policy recommendations to allay these concerns.

Suggested Citation

  • Ding, Tao & Li, Hao & Tan, Ruipeng & Zhao, Xin, 2023. "How does geopolitical risk affect carbon emissions?: An empirical study from the perspective of mineral resources extraction in OECD countries," Resources Policy, Elsevier, vol. 85(PB).
    • Handle: RePEc:eee:jrpoli:v:85:y:2023:i:pb:s0301420723006943
    DOI: 10.1016/j.resourpol.2023.103983
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