AN EMPIRICAL ANALYSIS OF CO2 EMISSION AND SOCIOECONOMIC FACTORS NEXUS: IS THE LONG RUN CO-INTEGRATING RELATIONSHIP EXIST IN MALAYSIA?

Siti Ayu Jalil, Azzahrah Juraimi

Abstract


One of the most crucial environmental and economic issue was the rising trend of carbon dioxide emission that leads to climate change. Malaysia is one of the highest contributors of carbon dioxide emission relative to its neighbouring countries in Southeast Asia. The inability to curb the upward trend will harm the environment and cause a threat to public health. Using a time series data from 1980 until 2017, this study investigates the long run equilibrium relationship between socioeconomic factors namely economic growth, energy consumption, renewable energy consumption and population with carbon dioxide emission in Malaysia. The findings showed that there is a long run cointegrating relationship between the socioeconomic factors and carbon dioxide emission in Malaysia. Whereas, the Granger causality indicates that there exists a bidirectional causality running from energy consumption to CO2 emission and a unidirectional causality running from CO2 emission towards population, but there is no causality link between economic growth and renewable energy consumption with CO2 emission. Since any activities of these variables could influence the level of CO2 emission, apparently the key recommendation for Malaysia is to adopt the use of renewable energy.


Keywords


Economic Growth, Energy Consumption, Renewable Energy Consumption, Population, Carbon Dioxide Emission

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DOI: https://doi.org/10.25292/atlr.v3i0.363

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