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Modeling CO2 emissions in an emerging market: empirical finding from ARDL-based bounds and wavelet coherence approaches

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Abstract

This study aims to investigate the long-run and causal effects of energy consumption, economic growth, urbanization, and trade openness on CO2 emissions in Turkey using newly developed econometric techniques. To our best knowledge, there has been no study examining the relationship between CO2 emissions, energy consumption, trade openness, urbanization, and economic growth in Turkey. Therefore, this study proposes to fill this gap in the literature. In this study, we use time series data covering the years between 1960 and 2015. To capture long-run effects, we used ARDL, FMOLS, and DOLS estimators, while wavelet coherence technique is used to explore causal effects among the variables. Our results reveal that (i) there is a long-run equilibrium relationship between CO2 emissions and energy consumption, economic growth, urbanization, and trade openness; (ii) in the long-run, CO2 emission in Turkey is significantly triggered by energy consumption, economic growth, and urbanization; and (iii) the results of the wavelet coherence–based causality test provide supportive evidence to the long-run estimations of this study.

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Notes

  1. In this study, only three of the five different cases of bounds test are taken into consideration since only these three give reliable results (Katircioglu et al., 2013). Bounds test is applied without deterministic unrestricted intercept and without trend, with deterministic unrestricted intercept and restricted trend, and with unrestricted intercept and restricted trend for case III, case IV, and case V, respectively.

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Authors and Affiliations

  1. Faculty of Economics and Administrative Science, Department of Economics, European University of Lefke, Lefke, Northern Cyprus, TR-10 Mersin, Turkey

    Demet Beton Kalmaz

  2. Faculty of Economics and Administrative Science, Department of Banking and Finance, European University of Lefke, Lefke, Northern Cyprus, TR-10 Mersin, Turkey

    Dervis Kirikkaleli

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  1. Demet Beton Kalmaz
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Correspondence to Demet Beton Kalmaz.

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Kalmaz, D.B., Kirikkaleli, D. Modeling CO2 emissions in an emerging market: empirical finding from ARDL-based bounds and wavelet coherence approaches. Environ Sci Pollut Res 26, 5210–5220 (2019). https://doi.org/10.1007/s11356-018-3920-z

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