The European Journal of Comparative Economics

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EJCE Year: 2020, July. Volume: 17 - Issue: 1

Carbon emissions, income inequality and environmental degradation: the case of Mediterranean countries

by Fateh Belaïd, Sabri Boubaker, Rajwane Kafrouni

Start page: 73 - End page: 102

Keywords: Income inequality, Environmental degradation, Economic growth, Heterogeneous panel

Jel code: C2; O1; Q5; R1

DOI: 10.25428/1824-2979/202001-73-102

Abstract:

This study examines the main driving forces affecting short- and long-term CO₂ emissions pattern due to changes in growth and income inequality for 11 Mediterranean economies over the period 1990—2012. It proposes an autoregressive dynamic distributive lag dynamic panel specification to (i) test for non-linearity between income inequality and CO₂ emissions, (ii) assess whether there is a differentiated effect of income inequality on CEO2 emissions depending on the level of GDP, and (iii) test for other sources of non-linearity between income inequality and CO₂ emissions. The results indicate a negative and significant association between income inequality and carbon emissions which means that greater inequality leads to environmental degradation. However, in the short-run, the results show a positive and significant relationship between the income inequality and CO₂ emissions

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