Investigating the dynamic linkages among carbon dioxide emissions, economic growth, and renewable and non-renewable energy consumption: evidence from developing countries.

This research paper examines the causal relationships among carbon dioxide emissions, economic growth, and renewable and non-renewable energy consumption, for a panel of 68 developing countries over the period 1990 - 2014. We use the multivariate panel cointegration framework and apply a battery of conventional (Pedroni 1999, 2004; and Kao 1999) as well as newly developed methodologies accounting for heterogeneity and cross-sectional correlation (Westerlund's ECM panel cointegration (2007) and panel bootstrap cointegration (2007) tests). The pooled mean group (PMG), mean group (MG), and dynamic fixed effects (DFE) methodologies were further applied to trace out the short-run dynamics. The results support evidence of significant dynamic linkages among the involved variables and reveal possible differences in the magnitude of the impacts from renewable and non-renewable energy consumption on environmental quality. The issue of distinguishing by source and determining the magnitude of the detected effects could provide valuable information for a sustainable economic and environmental development, substantially helping policy makers to designate more efficient policy measures.