Abstract:
The increase of greenhouse gases (GHG) in which CO2 emissions constitute the principal component, is of major environmental problems of all societies. Economic growth impels intensive use of resources and as a result, more residues and wastes thrown in the nature that could lead to environmental degradation. This article tries to trace the eventual relationship between trade openness and environmental degradation in Iran. For this purpose, a multivarate model is employed in which economic growth and trade openness are related to CO2 emissions for the period of 1971-2006. By carring out the Granger causality test, there appeared a unidirectional relation from trade openness to CO2 emissions. To analyze the variables’ relationships, the approach of GMM is applied. Results indicate that economic growth has a significant negative effect on carbon dioxcide emissions. But, the impact of trade openness on carbon dioxcide emissions is significantly positive.
Machine summary:
"For this purpose, a multivarate model is employed in which economic growth and trade openness are related to CO2 emissions for the period of 1971-2006.
Managi, Hibiki and Tsurumi (2009) by using the technique of instrumental variables, studied the relationships between trade openness and the environment quality in OECD and non-OECD countries.
We use a model that relates CO2 emissions to economic growth, trade openness, labor force, capital stock, urban population, and energy consumption.
3-Results and discussion To study the impact of trade openness on CO2 emission, we have used the Iranian data of gross domestic production, capital stock, labor force, trade openness, energy consumption, and rate of urbanization for the period of 1971-2008.
به تصویر صفحه مراجعه شود)) Table 1- Results of ADF and IPS unit root tests As table 1 summarizes, ADF and PS tests indicate that all variables - except growth rate of urbanization -are stationary at the level.
Table 3- Pair wise Granger Causality tests between trade openness and CO2 emissions Null Hypothesis Obs F-Statistic Probability DLTRAD does not Granger Cause DLCO2 37 7.
Table 4- Estimation of equation 4, determining the trade openness and CO2 emissions relations Variable Intercept Growth rate of capital stock log Growth rate of labor force log Growth rate of gross domestic production log Growth rate of energy consumption log Growth rate of trade openness Growth rate of (trade)^2 Coefficient 0.
For this purpose, a multivariate model including the economic growth, carbon emissions, trade openness, energy consumption, capital stock, labor force, and the rate of urbanization for the period of 1971-2008 was used."