Urbanization And Temperature Change- Accounting For International Differences From Brics

Urban induced industrialization, energy consumption, carbon emission and rising percapita automobile consumption have impelled society to brace for the heat wave like conditions. Over last 50 years (1956-2005), average annual temperature worldwide has been increased by 0.13 C degrees. Post 2005 period has even faced some unprecedented heat wave conditions across the globe starting from Europe in 2003, Greece in 2006, North America, 2006, India in 2010, 2013 and 2015, Australia in 2012. In this context, this paper empirically examines the importance of such unsystematic urbanization with respect to annual temperature change in case of so-called BRICS economies. For this we have collected data ranging from 1980 to 2012 for five economies namely Brazil, Russia, India, China and South Africa. Data w.r.t annual temperature, urbanization, energy consumption, carbon emission and foreign direct investment are mainly collected from World Bank, EIA and UNCTAD databases. In our empirical setup, we have employed Bayer-Hanck cointegration and different structural break tests. Our long run cointegration result shows that both pollution and annual temperature changes are well cointegrated and robust enough to capture the trend of global warming and environmental changes in an economy. Further, the evidence of structural break tests in forms of Zivot-Andrews Unit Root test and Gregory-Hansen cointegration tests are applied to ensure the breakpoint. It captures the condition of relative unsustainability from the year, when urbanization has exerted significant effect upon the environmental indicators and annual temperature variation. Furthermore, we apply chow forecast test to examine the significance of structural breaks in an economy during the period. The result shows that there exists no breakpoint in all these economies except Brazil during 1990-2012 period. The main policy implication emerging out of this study is that there must be the element of sustainability in industrialization and urbanization processes of the developing economies. The developing economies primarily must adopt the short term goal in attaining sustainability in a coordinated manner and switch over to the long term goal later. All our empirical investigations have confirmed that if such unbalanced growth is not controlled, then the effect of global warming on BRICS is quite imminent.