This paper reanalyzes the determinants of the CO2 emissions in France. For this purpose, it considers the unit root test with two structural breaks and a dynamic ordinary least squares estimation. The paper also considers the effects of the energy consumption and the economic complexity on CO2 emissions. First, it is observed that the EKC hypothesis is valid in France. Second, the positive effect of the energy consumption on CO2 emissions is obtained. Third, it is observed that a higher economic complexity suppresses the level of CO2 emissions in the long run. The findings imply noteworthy environmental policy implications to decrease the level of CO2 emissions in France.
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According to the World Bank data, Qatar is the richest country with $139,174 GDP per capita in 2014. However, its economic complexity ranking is 60th in the world within the same year.
For a recent literature review of the EKC hypothesis, See Al-Mulali and Ozturk (2016).
For an exceptional approach, e.g., See Bento and Moutinho (2016).
For instance, capital formation (Zhang and Cheng 2009), export diversification (Gozgor and Can 2016), export quality (Gozgor and Can 2017), financial development (Javid and Sharif 2016), foreign direct investment (FDI) (Tang and Tan 2015), population density (Onafowora and Owoye 2014), trade openness (Onafowora and Owoye 2014), and urbanization (Zhang and Cheng 2009) are used as an additional control variable to analyze the validity of the EKC hypothesis in developing countries.
According to the Atlas of Economic Complexity, France is the 13th complex economy in the world in 2014.
In some cases, taking the natural logarithm of the ECI can be problematic. In the French case, economic complexity values are always positive (i.e., the ECI values of France are always above the world’s average for the period from 1964 to 2014). However, economic complexity values can be negative in the low-income and some developing economies; and in such a case, one cannot take the natural logarithm of the negative ECI values.
We would like to thank an anonymous reviewer for pointing out this issue.
It is important to indicate that the reference year should probably be the last observation of the empirical examination since one should pay regard to the ECI values of all products in the previous years.
See Can and Dogan (2017) for details of the ECI and the product space theory.
We refer to the original papers for the details of the unit root test and the DOLS estimation techniques. We did not provide the equations for test procedures to save space.
Note that 106.7% = 100 ∗ (e 0.726 – 1).
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We would like to express our gratitude to the editor and two anonymous referees for their valuable comments, which significantly improved the paper.
Responsible editor: Philippe Garrigues
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Can, M., Gozgor, G. The impact of economic complexity on carbon emissions: evidence from France. Environ Sci Pollut Res 24, 16364–16370 (2017). https://doi.org/10.1007/s11356-017-9219-7
- Environmental degradation
- CO2 emissions
- Economic complexity
- Time series modeling