Abstract
While the relationship between carbon dioxide (CO2) emission and its determinants has been widely examined in Asia, little attention has been paid to the role played by the participation in global value chains (GVCs). Thus, this study aims to fill this research gap by investigating the relationship between participation in GVCs and CO2 emissions in eleven Asian countries along with economic growth, energy consumption, trade openness, and population density. The study covers the period 1995q1–2014q4 and employs both fully modified ordinary least square (FMOLS) and dynamic ordinary least square (DOLS) methods, as well as cointegration and causality tests to examine the dynamics between variables. The findings indicate a cointegration relationship between the variables. Moreover, both FMOLS and DOLS results show that higher participation in global value chains leads to a reduction of CO2 emissions, while economic growth and energy consumption increase CO2 emissions. The outcomes also indicate a negative relationship between trade openness and CO2 emissions. Thus, the selected Asian countries should promote policies aimed at enhancing their participation in global value chains and expanding their openness to trade. Besides, the selected countries are expected to implement energy-saving policies and promote cleaner sources of energy.
This is a preview of subscription content, log in via an institution to check access.
Similar content being viewed by others
Notes
Source: International Energy Agency (IEA), Global Energy & CO2 Status Report, March 2019.
References
Acheampong AO (2018) Economic growth, CO2 emissions and energy consumption: what causes what and where? Energy Econ 74:677–692. https://doi.org/10.1016/j.eneco.2018.07.022
Ali W, Abdullah A, Azam M (2017) Re-visiting the environmental Kuznets curve hypothesis for Malaysia: fresh evidence from ARDL bounds testing approach. Renew Sust Energ Rev 77:990–1000. https://doi.org/10.1016/j.rser.2016.11.236
Al-Mulali U, Ozturk I, Solarin SA (2016) Investigating the environmental Kuznets curve hypothesis in seven regions: the role of renewable energy. Ecol Indic 67:267–282
Apergis N, Ozturk I (2015) Testing environmental Kuznets curve hypothesis in Asian countries. Ecol Indic 52:16–22. https://doi.org/10.1016/j.ecolind.2014.11.026
Baek J (2016) A new look at the FDI-income-energy-environment nexus: dynamic panel data analysis of ASEAN. Energy Policy 91:22–27. https://doi.org/10.1016/j.enpol.2015.12.045
Behera RS, Dash DP (2017) The effect of urbanization, energy consumption, foreign direct investment on the carbon dioxide emissions in the SSEA (South and Southeast Asian) region. Renew Sust Energ Rev 70:96–106. https://doi.org/10.1016/j.rser.2016.11.201
De BK, Miroudot S (2013) Mapping global value chains. OECD trade policy papers, no.159. OECD Publishing, Paris. https://doi.org/10.1787/5k3v1trgnbr4-en
Dumitrescu E-I, Hurlin C (2012) Testing for Granger non-causality in heterogeneous panels. Econ Model 29(4):1450–1460. https://doi.org/10.1016/j.econmod.2012.02.014
Granger CWJ (1969) Investigating causal relations by econometric models and cross-spectral methods. Econometrica 37(3):424–438
Grossman GM, Krueger AB (1995) Economic growth and the environment. Q J Econ 110(2):353–377
Im KS, Pesaran MH, Shin Y (2003) Testing for unit roots in heterogeneous panels. J Econ 115(1):53–74. https://doi.org/10.1016/S0304-4076(03)00092-7
IPCC (Intergovernmental Panel on Climate Change) et al (2013) Observations: atmosphere and surface. In: Stocker TF, Qin D, Plattner G-K, Tignor M, Allen SK, Boschung J, Nauels A, Xia Y, Bex V, Midgley PM (eds) Climate change 2013: the physical science basis. Contribution of Working Group I to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press, Cambridge and New York, pp 154–259
Jafari Y, Othman J, Nor AHSM (2012) Energy consumption, economic growth and environmental pollutants in Indonesia. J Policy Model 34:879–889. https://doi.org/10.1016/j.jpolmod.2012.05.020
Jalil A, Mahmud SF (2009) Environment Kuznets curve for CO2 emissions: a cointegration analysis for China. Energy Policy 37(12):5167–5172. https://doi.org/10.1016/j.enpol.2009.07.044
Kao C (1999) Spurious regression and residual-based tests for cointegration in panel data. J Econ 90:1–44
Kao C, Chiang MH (2001) On the estimation and inference of a cointegrated regression in panel data. Adv Econ 15:179–222
Kasman A, Duman YS (2015) CO2 emissions, economic growth, energy consumption, trade and urbanization in new EU member and candidate countries: a panel data analysis. Econ Model 44:97–103. https://doi.org/10.1016/j.econmod.2014.10.022
Kassi DF, Sun G, Ding N, Rathnayake DN, Assamoi GR (2019) Asymmetry in exchange rate pass-through to consumer prices: evidence from emerging and developing Asian countries. Econ Anal Policy 62:357–372. https://doi.org/10.1016/j.eap.2018.09.013
Kivyiro P, Arminen H (2014) Carbon dioxide emissions, energy consumption, economic growth, and foreign direct investment: causality analysis for Sub-Saharan Africa. Energy 74:595–606. https://doi.org/10.1016/j.energy.2014.07.025
Koopman R, Wang Z, Wei S-J (2014) Tracing value-added and double counting in gross exports. Am Econ Rev 104(2):459–494
Kowalski P, Lopez-Gonzales J, Ragoussis A, Ugarte C (2015) Developing countries participation in global value chains and its implications for trade and trade related policies. OECD trade policy paper no.179. OECD, Paris. https://doi.org/10.1787/5js33lfw0xxn-en
Krugman P (1995) Increasing returns, imperfect competition and the positive theory of international trade. In: Grossman GM, Rogoff K (eds) Handbook of International Economics, vol 3. Elsevier Science B.V., pp 1243–1277
Kurniawan R, Managi S (2018) Coal consumption, urbanization, and trade openness linkage in Indonesia. Energy Policy 121:576–583. https://doi.org/10.1016/j.enpol.2018.07.023
Lau LS, Choong CK, Eng YK (2014) Investigation of the environmental Kuznets curve for carbon emissions in Malaysia: do foreign direct investment and trade matter? Energy Policy 68:490–497. https://doi.org/10.1016/j.enpol.2014.01.002
Lee JW (2019) Long-run dynamics of renewable energy consumption on carbon emissions and economic growth in the European Union. Int J Sust Dev World Ecol 26(1):69–78. https://doi.org/10.1080/13504509.2018.1492998
Levin A, Lin CF, Chu C (2002) Unit root tests in panel data: asymptotic and finite-sample properties. J Econ 108:1–24
Marques AC, Fuinhas JA, Leal PA (2018) The impact of economic growth on CO2 emissions in Australia: the environmental Kuznets curve and the decoupling index. Environ Sci Pollut Res 25(27):27283–27296. https://doi.org/10.1007/s11356-018-2768-6
Meng B, Peters GP, Wang Z, Li M (2018) Tracing CO2 emissions in global value chains. Energy Econ 73:24–42. https://doi.org/10.1016/j.eneco.2018.05.013
Muhammad B (2019) Energy consumption, CO2 emissions and economic growth in developed, emerging and Middle East and North African countries. Energy 179:232–245. https://doi.org/10.1016/j.energy.2019.03.126
Nasir AM, Huynh TLD, Tram HTX (2019) Role of financial development, economic growth and foreign direct investment in driving climate change: a case of emerging ASEAN. J Environ Manag 242:131–141. https://doi.org/10.1016/j.jenvman.2019.03.112
Oh KY, Bhuyan MI (2018) Trade openness and CO2 emissions: evidence of Bangladesh. Asian J Atmos Environ 12(1):30–36
Ohlan R (2015) The impact of population density, energy consumption, economic growth and trade openness on CO2 emissions in India. Nat Hazards 79(2):1409–1428. https://doi.org/10.1007/s11069-015-1898-0
Omri A, Daly S, Rault C, Chaibi A (2015) Financial development, environmental quality, trade and economic growth: what causes what in MENA countries. Energy Econ 48:242–252. https://doi.org/10.1016/j.eneco.2015.01.008
Ozturk I, Al-Mulali U (2015) Investigating the validity of the environmental Kuznets curve hypothesis in Cambodia. Ecol Indic 57:324–330. https://doi.org/10.1016/j.ecolind.2015.05.018
Pedroni P (2000) Fully modified OLS for heterogeneous cointegrated panels. Department of Economics Working Papers 2000-03. Williams College, Department of Economics. Available at: https://web.williams.edu/Economics/wp/pedroniaie.pdf. Accessed 5 Oct 2019
Philips PCB, Peron P (1988) Testing for a unit root in time series regression. Biometrika 75(2):335–346. https://doi.org/10.1093/biomet/75.2.335
Saboori B, Sulaiman J (2013) CO2 emissions, energy consumption and economic growth in Association of Southeast Asian Nations (ASEAN) countries: a cointegration approach. Energy 55:813–822. https://doi.org/10.1016/j.energy.2013.04.038
Sarkodie SA, Strezov V (2019) Effect of foreign direct investments, economic development and energy consumption on greenhouse gas emissions in developing countries. Sci Total Environ 646:862–871. https://doi.org/10.1016/j.scitotenv.2018.07.365
Shahbaz M, Muhammad Q, Hye A, Tiwari AK, Leitao NC (2013) Economic growth, energy consumption, financial development, international trade and CO2 emissions in Indonesia. Renew Sust Energ Rev 25:109–121
Shahbaz M, Mallick H, Mahalik MK, Loganathan N (2015) Does globalization impede environmental quality in India? Ecol Indic 52:379–393. https://doi.org/10.1016/j.ecolind.2014.12.025
Shahbaz M, Mallick H, Mahalik MK, Sadorsky P (2016) The role of globalization on the recent evolution of energy demand in India: implications for sustainable development. Energy Econ 55:52–68. https://doi.org/10.1016/j.eneco.2016.01.01
Shahbaz M, Nasreen S, Ahmed K, Hammoudeh S (2017) Trade openness-carbon emissions nexus: the importance of turning points of trade openness for country panels. Energy Econ 61:221–232. https://doi.org/10.1016/j.eneco.2016.11.008
Shahbaz M, Haouas I, Hoang THV (2019) Economic growth and environmental degradation in Vietnam: is the environmental Kuznets curve a complete picture? Emerg Mark Rev 38:197–218. https://doi.org/10.1016/j.ememar.2018.12.006
Sharma SS (2011) Determinants of carbon dioxide emissions: empirical evidence from 69 countries. Appl Energy 88:376–382
Silva S, Soares I, Pinho C (2012) The impact of renewable energy sources on economic growth and CO2 emissions: a SVAR approach. Eur Res Stud 15(4): 133–144. https://doi.org/10.35808/ersj/374
Solarin SA, Al-Mulali U, Sahu PK (2017) Globalisation and its effect on pollution in Malaysia: the role of Trans-Pacific Partnership (TPP) agreement. Environ Sci Pollut Res 24(29):23096–23113. https://doi.org/10.1007/s11356-017-9950-0
Tang CF, Tan BW (2015) The impact of energy consumption, income, and foreign direct investment on carbon dioxide emissions in Vietnam. Energy 79:447–454. https://doi.org/10.1016/j.energy.2014.11.033
UNCTAD (2013) Global value chains: investment and trade for development. World investment report. United Nations, New York and Geneva
Wang SS, Zhou DQ, Zhou P, Wang Q (2011) CO2 emissions, energy consumption and economic growth in China: a panel data analyses. Energy Policy 39(9):4870–4875. https://doi.org/10.1016/j.enpol.2011.06.032
Wang J, Wan G, Wang C (2019) Participation in GVCs and CO2 emissions. Energy Econ 84:104561. https://doi.org/10.1016/j.eneco.2019.104561
World Bank (2017) World development indicators. Washington, DC. Available at: http://data.worldbank.org/data-catalog/world-development-indicators. Accessed 28 Sep 2019
World Bank Group, IDE-JETRO, OECD, WTO, University of International Business and Economics (2017) Measuring and analyzing the impact of GVCs on economic development: global value chain development report 2017. World Bank Group, Washington, DC
WTO, IDE-JETRO (2013) Trade patterns and global value chains in East Asia: from trade in goods to trade in tasks. WTO, Geneva
Yu C, Luo Z (2018) What are China’s real gains within global value chains? Measuring domestic value added in China’s exports of manufactures. China Econ Rev 47:263–273. https://doi.org/10.1016/j.chieco.2017.08.010
Zaidi SAH, Zafar MW, Shahbaz M, Hou F (2019) Dynamic linkages between globalization, financial development and carbon emissions: evidence from Asia Pacific Economic Cooperation countries. J Clean Prod 228:533–543. https://doi.org/10.1016/j.jclepro.2019.04.220
Zhang S, Liu X, Bae J (2017) Does trade openness affect CO2 emissions: evidence from newly industrialized countries? Environ Sci Pollut Res 24:17616–17625. https://doi.org/10.1007/s11356-017-9392-8
Zhu H, Duan L, Guo Y, Yu K (2016) The effects of FDI, economic growth and energy consumption on carbon emissions in ASEAN-5: evidence from panel quantile regression. Econ Model 58:237–248. https://doi.org/10.1016/j.econmod.2016.05.003
Author information
Authors and Affiliations
Contributions
Conceptualization: Guy Roland Assamoi; data curation: Akadje Jean-Roland Edjoukou; formal analysis: Thierry Bienvenu Yobouet Gnangoin; methodology: Guy Roland Assamoi; project administration: Shaoyuan Wang and Yao Liu; software: Diby Francois Kassi; supervision: Shaoyuan Wang and Yao Liu; writing of original draft: Guy Roland Assamoi; writing of review and editing: Yao Liu.
Corresponding author
Ethics declarations
Conflict of interest
The authors declare that they have no conflict of interest.
Additional information
Responsible editor: Nicholas Apergis
Publisher’s note
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
Rights and permissions
About this article
Cite this article
Assamoi, G.R., Wang, S., Liu, Y. et al. Dynamics between participation in global value chains and carbon dioxide emissions: empirical evidence for selected Asian countries. Environ Sci Pollut Res 27, 16496–16506 (2020). https://doi.org/10.1007/s11356-020-08166-9
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s11356-020-08166-9