Economic growth, energy consumption and CO2 emissions in Gulf cooperation council countries

Economic growth, energy consumption and CO2 emissions in Gulf cooperation council countries

This study examines the empirical relationship between economic growth, energy consumption and carbon dioxide emissions, calculates the trend of decoupling effects and finally analyzes the evolution of inequality in CO2 emissions in GCC (Gulf Cooperation Council countries) countries. Results indicate a positive and significant association between energy consumption and CO2 emissions and between economic growth and energy consumption both in the short- and the long-run. No significant relationship is found between economic growth and CO2 emissions. Energy consumption and CO2 emissions Granger cause each other while unidirectional causal link running from economic growth to energy consumption is also found to exist. Both absolute and relative decoupling occurred in all the GCC countries except Saudi Arabia during the study period. Divergences in the Gini index values contributed towards different levels of emissions inequality in the region. CO2 emissions inequality significantly declined both in energy carriers as well as in the economic sectors over time. Despite some optimistic findings, the GCC countries are still significant contributors to CO2 emissions and as such, the study recommends pursuing favorable regulatory policies that would promote various initiatives to reduce emissions. The overall findings will help GCC countries assess its position better in future climate change negotiations.

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