Environmental Kuznets Curve & Effectiveness of International Policies: Evidence from Cross Country Carbon Emission Analysis

TL;DR

This study examines the relationship between income levels and carbon emissions across 24 countries over 56 years, confirming the EKC hypothesis for high-income nations and highlighting the ineffectiveness of international policies in early emission decline initiation.

Contribution

It provides empirical evidence supporting the EKC hypothesis and analyzes the impact of international policies on emission trends across different income groups.

Findings

EKC valid for high-income countries with declining emissions

International policies are ineffective in early emission decline

High-income countries' emission decline start years vary significantly

Abstract

In this article, we are presenting the relationship between environmental pollution and the income level of the selected twenty-four countries. We implemented a data-based research analysis where, for each country, we analyzed the related data for fifty-six years, from 1960 to 2016, to assess the relationship between the carbon emission and income level. After performing the related data analysis for each country, we concluded whether the results for that country were in line with the Environmental Kuznets Curve (EKC) hypothesis. The EKC hypothesis suggests that the carbon emission per capita starts a declining trend when the country-specific high level of income is reached. The results of our data analyses show that the EKC hypothesis is valid for high-income countries and the declining trends of carbon emission are clearly observed when the income level reaches a specific high enough level. On the other hand, for the non-high income countries, our analysis results show that it is too early to make an assessment at this growth stage of their economies because they have not reached their related high-enough income per capita levels yet. Furthermore, we performed two more additional analyses on high-income countries. First, we analyzed the related starting years of their carbon emission declining trends. The big variance in the starting years of the carbon emission declining trends shows that the international policies are clearly ineffective in initiating the declining trend in carbon emission. In addition, for the high-income countries, we explained the differences in their carbon emission per capita levels in 2014 with their SGI indices and their dependence on high-carbon emission energy production.