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The Effect of Energy Usage, Economic Growth, and Financial Development on CO 2 Emission Management: An Analysis of OECD Countries with a High Environmental Performance Index

Author

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  • Katarzyna Szymczyk

    (Faculty of Management, Czestochowa University of Technology, 42-201 Częstochowa, Poland)

  • Dilek Şahin

    (Tourism Management Department, Tourism Faculty, Sivas Cumhuriyet University, 58040 Sivas, Turkey)

  • Haşim Bağcı

    (Faculty of Health Sciences, Aksaray University, 68100 Aksaray, Turkey)

  • Ceyda Yerdelen Kaygın

    (International Trade and Logistics Department, Faculty of Economics and Administrative Sciences, Kafkas University, 36040 Kars, Turkey)

Abstract

The environmental performance index was developed to protect public health, and to sustain and manage the ecological vitality that is a crucial factor in countries’ social and economic development. The increase in CO 2 emissions has been threatening environmental and human health. The main objective of this study is to evaluate the impact of economic growth, energy consumption, energy management, the urban population, trade openness, and financial development on CO 2 emissions in the OECD countries that have a high ranking in the environmental performance index by utilizing the panel data analysis method for the years spanning 1990–2014. This assessment finds positive relationships between economic growth, energy consumption, and the urban population, and CO 2 emissions. Moreover, it is put forward that a negative and significant relationship between financial development and CO 2 emissions exists. Despite displaying a similar negative correlation, the relationship between trade openness and CO 2 emissions is insignificant. In the Dumitrescu-Hurlin panel causality test conducted, it was seen that a two-way causality is prevalent between energy consumption and CO 2 emissions. In addition, interrelations where CO 2 emissions cause trade openness, and the urban population is an explanatory variable of the former relationship, were discovered.

Suggested Citation

  • Katarzyna Szymczyk & Dilek Şahin & Haşim Bağcı & Ceyda Yerdelen Kaygın, 2021. "The Effect of Energy Usage, Economic Growth, and Financial Development on CO 2 Emission Management: An Analysis of OECD Countries with a High Environmental Performance Index," Energies, MDPI, vol. 14(15), pages 1-21, August.
    • Handle: RePEc:gam:jeners:v:14:y:2021:i:15:p:4671-:d:606616
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