Preprint Article Version 1 This version not peer reviewed

The Kenya Case of Multivariate Causality of Carbon Dioxide Emissions

Version 1 : Received: 25 December 2016 / Approved: 26 December 2016 / Online: 26 December 2016 (10:02:23 CET)

How to cite: Asumadu-Sarkodie, S.; Owusu, P.A. The Kenya Case of Multivariate Causality of Carbon Dioxide Emissions. Preprints 2016, 2016120127 (doi: 10.20944/preprints201612.0127.v1). Asumadu-Sarkodie, S.; Owusu, P.A. The Kenya Case of Multivariate Causality of Carbon Dioxide Emissions. Preprints 2016, 2016120127 (doi: 10.20944/preprints201612.0127.v1).

Abstract

In this study, an attempt was made to investigate the Kenya case of multivariate causality of carbon dioxide emissions by employing a time series data spanning from 1961-2011 using the ARDL method of cointegration analysis. The long-run elasticities show that, a 1% increase in financial development increases carbon dioxide emissions by 0.28%, a 1% increase in GDP per capita increases carbon dioxide emissions by 1.32% and a 1% increase in urbanization decreases carbon dioxide emissions by 1.14%. There was a unidirectional causality running from financial development, food production index, GDP per capita, industrialization and urbanization to carbon dioxide emissions. The innovation accounting shows that 20% of future shocks in carbon dioxide emissions are due to fluctuations in financial development, 9% of future shocks in financial development are due to fluctuations urbanization and 22% of future shocks in food production index are due to fluctuations in carbon dioxide emissions.

Subject Areas

Granger-causality; carbon dioxide emissions; ARDL; Kenya; variance decomposition; climate change

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