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Abstract
Economic development plays a crucial role in contributing to CO2 emissions. Therefore, this research aims to investigate environmental degradation caused by economic activities within the scope of G-20 Countries, which comprise the largest economies and advanced industries. The primary objective of this study is to deliver an empirical study of gross domestic product, foreign direct investment, industry value-added, and population on CO2 emissions in G20 Countries. Using panel data from 2000-2022, the research found a positive correlation between GDP and CO2 emissions. Meanwhile, by utilizing GDP squared, the existence of the Environmental Kuznet Curve (EKC) theory was identified. The EKC theory indicates a significant negative correlation between GDP squared and CO2 emission. This is attributed to several factors, including increased public awareness of environmental protection and technological advancements in developed countries, contributing to improved energy efficiency. For the variables of FDI and population, a negative correlation with CO2 was found. On the other hand, the value-added industry shows a positive and significant correlation with CO2 emissions.
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References
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- Suci, S. C., Zahara, V. M., Ginanjar, R. A. F., & Anwar, C. J. (2023). Does Globalization Worsen Environmental Quality in ASEAN Countries? Jurnal Ekonomi Pembangunan, 20(2), 173–180. https://doi.org/10.29259/jep.v20i2.19176
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References
Adebayo, T. S., Awosusi, A. A., & Adeshola, I. (2020). Determinants of CO2 Emissions in Emerging Markets: An Empirical Evidence from Mint Economies. International Journal of Renewable Energy Development, 9(3), 411–422. https://doi.org/10.14710/ijred.2020.31321
Ahmed, F., Ali, I., Kousar, S., & Ahmed, S. (2022). The Environmental Impact of Industrialization and Foreign Direct Investment: Empirical Evidence from Asia-Pacific Region. Environmental Science and Pollution Research, 29(20), 29778–29792. https://doi.org/10.1007/s11356-021-17560-w
Aslam, B., Hu, J., Shahab, S., Ahmad, A., Saleem, M., Shah, S. S. A., Javed, M. S., Aslam, M. K., Hussain, S., & Hassan, M. (2021). The Nexus of Industrialization, GDP Per Capita, and CO2 Emission in China. Environmental Technology and Innovation, 23, 101674. https://doi.org/10.1016/j.eti.2021.101674
Bashir, A., Susetyo, D., Suhel, S., & Azwardi, A. (2021). Relationships between Urbanization, Economic Growth, Energy Consumption, and CO2 Emissions: Empirical Evidence from Indonesia. Journal of Asian Finance, Economics and Business, 8(3), 79–90. https://doi.org/10.13106/jafeb.2021.vol8.no3.0079
Climate Watch. (2023). GHG emission G20 Total Metrics. Climate Watch: Historical GHG Emission
D’Orazio, P., & Dirks, M. W. (2022). Exploring the Effects of Climate-Related Financial Policies on Carbon Emissions in G20 Countries: a Panel Quantile Regression Approach. Environmental Science and Pollution Research, 29(5), 7678–7702. https://doi.org/10.1007/s11356-021-15655-y
Guo, H., Jiang, J., Li, Y., Long, X., & Han, J. (2023). An Aging Giant at the Center of Global Warming: Population Dynamics and its Effect on CO2 Emissions in China. Journal of Environmental Management, 327(February 2022), 116906. https://doi.org/10.1016/j.jenvman.2022.116906
Habib, Y., Xia, E., Hashmi, S. H., & Ahmed, Z. (2021). The Nexus between Road Transport Intensity and Road-related CO2 Emissions in G20 Countries: an Advanced Panel Estimation. Environmental Science and Pollution Research, 28(41), 58405–58425. https://doi.org/10.1007/s11356-021-14731-7
Hanif, I., Faraz Raza, S. M., Gago-de-Santos, P., & Abbas, Q. (2019). Fossil Fuels, Foreign Direct Investment, and Economic Growth have Triggered CO2 Emissions in Emerging Asian Economies: Some Empirical Evidence. Energy, 171, 493–501. https://doi.org/10.1016/j.energy.2019.01.011
Haug, A. A., & Ucal, M. (2019). The Role of Trade and FDI for CO2 Emissions in Turkey: Nonlinear Relationships. Energy Economics, 81, 297–307. https://doi.org/10.1016/j.eneco.2019.04.006
Huang, Y., Chen, X., Zhu, H., Huang, C., & Tian, Z. (2019). The Heterogeneous Effects of FDI and Foreign Trade on CO2 Emissions: Evidence from China. Mathematical Problems in Engineering, 2019. https://doi.org/10.1155/2019/9612492
International Energy Agency. (2023). CO2 Emissions in 2022. Publication of CO2 Emissions in 2022. https://doi.org/10.1787/12ad1e1a-en
Islami, F. S., Prasetyanto, P. K., & Kurniasari, F. (2022). The Effect of Population, GDP, Non-Renewable Energy Consumption and Renewable Energy Consumption on Carbon Dioxide Emissions in G-20 Member Countries. International Journal of Energy Economics and Policy, 12(2), 103–110. https://doi.org/10.32479/ijeep.12548
Lawal, I. M. (2019). Impact of Population Growth on Carbon Dioxide (CO2) Emission: Empirical Evidence from Nigeria. Jurnal Perspektif Pembiayaan dan Pembangunan Daerah, 6(6), 701–708. https://doi.org/10.22437/ppd.v6i6.6730
Lestari, I. D., Effendi, N., & Priyono, A. F. (2020). Financial Development, Economic Growth, and Environmental Degradation Nexus in ASIAN Emerging Markets. Jurnal Ekonomi Pembangunan, 18(2), 177–189. https://doi.org/10.29259/jep.v18i2.12565
Li, K., & Lin, B. (2015). Impacts of Urbanization and Industrialization on Energy Consumption/CO2 Emissions: Does the Level of Development Matter? Renewable and Sustainable Energy Reviews, 52, 1107–1122. https://doi.org/10.1016/j.rser.2015.07.185
Lin, B., & Raza, M. Y. (2019). Analysis of Energy-related CO2 Emissions in Pakistan. Journal of Cleaner Production, 219, 981–993. https://doi.org/10.1016/j.jclepro.2019.02.112
Mendonça, A. K. de S., de Andrade Conradi Barni, G., Moro, M. F., Bornia, A. C., Kupek, E., & Fernandes, L. (2020). Hierarchical Modeling of the 50 Largest Economies to Verify the Impact of GDP, Population, and Renewable Energy Generation in CO2 Emissions. Sustainable Production and Consumption, 22, 58–67. https://doi.org/10.1016/j.spc.2020.02.001
Niyonzima, P., Yao, X., & Ofori, E. K. (2022). How do Economic Growth and the Emissions of Carbon Dioxide Relate? OALib, 09(03), 1–16. https://doi.org/10.4236/oalib.1108516
Paramati, S. R., Mo, D., & Gupta, R. (2017). The Effects of Stock Market Growth and Renewable Energy Use on CO2 Emissions: Evidence from G20 Countries. Energy Economics, 66, 360–371. https://doi.org/10.1016/j.eneco.2017.06.025
Patel, N., & Mehta, D. (2023). The Asymmetry Effect of Industrialization, Financial Development, and Globalization on CO2 Emissions in India. International Journal of Thermofluids, 20(June), 100397. https://doi.org/10.1016/j.ijft.2023.100397
Sabir, S., Qayyum, U., & Majeed, T. (2020). FDI and Environmental Degradation: The Role of Political Institutions in South Asian Countries. Environmental Science and Pollution Research, 27(26), 32544–32553. https://doi.org/10.1007/s11356-020-09464-y
Sikder, M., Wang, C., Yao, X., Huai, X., Wu, L., KwameYeboah, F., Wood, J., Zhao, Y., & Dou, X. (2022). The Integrated Impact of GDP Growth, Industrialization, Energy Use, and Urbanization on CO2 Emissions in Developing Countries: Evidence from the Panel ARDL Approach. Science of the Total Environment, 837(February), 155795. https://doi.org/10.1016/j.scitotenv.2022.155795
Suci, S. C., Zahara, V. M., Ginanjar, R. A. F., & Anwar, C. J. (2023). Does Globalization Worsen Environmental Quality in ASEAN Countries? Jurnal Ekonomi Pembangunan, 20(2), 173–180. https://doi.org/10.29259/jep.v20i2.19176
UNEP. (2023). Climate Change 2023: Synthesis Report UNEP - UN Environment Programme. 35–115. https://doi.org/10.59327/IPCC/AR6-9789291691647
World Bank. (2023). CO2 Emissions (Metric Tons Per Capita). World Bank: World Bank Open Data.
Xepapadeas, A., & Economides, G. (2022). Monetary Policy Under Climate Change. SSRN Electronic Journal, 7021. https://doi.org/10.2139/ssrn.4196636
Yang, Z., Abbas, Q., Hanif, I., Alharthi, M., Taghizadeh-Hesary, F., Aziz, B., & Mohsin, M. (2021). Short-run and Long-run Influence of Energy Utilization and Economic Growth on Carbon Discharge in Emerging SREB Economies. Renewable Energy, 165, 43–51. https://doi.org/10.1016/j.renene.2020.10.141