The Shape of Environmental Kuznets Curve in the Analysis of Environmental Quality
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Date
2015
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Publisher
Redeemer’s University Journal of Management and Social Studies
Abstract
Studies on Environmental Kuznets Curve (EKC) which attempt to investigate the relationship between environmental degradation (pollution/pollutants like CO2 emissions) and income per capita employ CO2 emissions as proxy for Environmental Quality(EQ). They, however, fail to capture the inverse relationship that exists between EQ and CO2 emissions. The present paper examines the implications of using CO2 emissions as a measure of EQ in the analysis of EKC shape. Theoretical expositions reveal that with EQ as regress and or EQ on the vertical axis of the growth-emission relationship, the hypothesized inverted-U EKC will transform into U-shaped Environmental Quality Kuznets Curve (EQKC) with similar pollution-income effects. Using CO2 emission as a proxy for EQ in the quadratic model of dynamic Ordinary Least Square (OLS) technique and employing relevant dataset of Nigeria over the period 1971-2013, this study discovered a U-shaped EKC and the alternative inverted-U shaped EQKC, in contrast to the hypothesized shapes. These findings confirm the existence of lower EQ in Nigeria particularly in the 21st century. The study therefore recommends the formulation and implementation of economic and environmental policies capable of reducing pollution emissions, particularly in the transport, power, and oil and gas sectors of the country.
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Keywords
Environmental Quality, Environmental Kuznets Curve, Environmental Quality Kuznets Curve, CO2 emissions, Energy consumption