The effect of renewable energy and financial development on carbon emissions based on consumption in Iran
Subject Areas :
1 -
Keywords: Keywords: consumption-based CO2 emission, economic growth, financial development, renewable energy consumption.,
Abstract :
The current research has investigated the effect of financial development and renewable energy consumption on carbon emissions based on consumption in Iran by controlling the variables of economic growth and electricity consumption in the period from 1990 to 2021. After examining the Manai test of the research variables using modified Dickey-Fuller and Ziot-Andrews tests, Bayer and Hank's cointegration test was performed to check the existence of collinearity between the research variables. Then, autoregressive distributed lag estimators, fully modified ordinary least squares, dynamic ordinary least squares and gradual shift causality test were used to investigate the long-term relationship of variables and their causal relationship. The results clearly show that financial development and renewable energy consumption reduce carbon emissions based on consumption in Iran, and economic development and financial development increase carbon emissions based on consumption. The results of the test of gradual causal changes have confirmed the main results of the estimation methods used. Therefore, policymakers in Iran should encourage research and development in low-carbon technologies and also target investments in renewable energy and reduce the level of non-renewable energy imports and avoid investing in high energy consumption sectors that lead to an increase Avoid carbon emissions based on consumption.
References:
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- Alkhathlan, K., & Javid, M. (2013). Energy consumption, carbon emissions and economic growth in Saudi Arabia: An aggregate and disaggregate analysis. Energy Policy, 62, 1525–1532. https://doi.org/10.1016/j.enpol.2013.07.068
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