Does Economic Policy Uncertainty Affect CO2 Emissions? Empirical Evidence from the United States

Qing Wang · Kefeng Xiao · Zhou Lu

140 citations0/0 files storedSustainability

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Energy, Environment, Economic Growth Climate Change Policy and Economics Market Dynamics and Volatility

Abstract

This paper aims to examine the effects of economic policy uncertainty (measured by the World Uncertainty Index—WUI) on the level of CO2 emissions in the United States for the period from 1960 to 2016. For this purpose, we consider the unit root test with structural breaks and the autoregressive-distributed lag (ARDL) model. We find that the per capita income promotes CO2 emissions in the long run. Similarly, the WUI measures are positively associated with CO2 emissions in the long run. Energy prices negatively affect CO2 emissions both in the short run and the long run. Possible implications of climate change are also discussed.

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References

2001Bounds testing approaches to the analysis of level relationships 1994Economic Growth and the Environment 1994Investment Under Uncertainty.1994Investment under Uncertainty 1991Environmental Impacts of a North American Free Trade Agreement 2009The Impact of Uncertainty Shocks 1980Irreversibility, Uncertainty, and Cyclical Investment 2004Environmental Kuznets Curve Hypothesis: A Survey

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