Democracy, Financial Openness, and Global Carbon Dioxide Emissions: Heterogeneity Across Existing Emission Levels

• Published in: World development Vol. 66; pp. 189 - 207
• Main Authors: You, Wan-Hai, Zhu, Hui-Ming, Yu, Keming, Peng, Cheng
• Format: Journal Article
• Language: English
• Published: Oxford Elsevier Ltd 01-02-2015; Pergamon Press Inc
• Subjects: Air pollution; Carbon dioxide; Carbon emissions; Democracy; distributional heterogeneity; Emissions control; Environmental degradation; Environmental effects; financial openness; International; Panel data; quantile regression; Regression analysis; Studies; quantile regression; financial openness; panel data; democracy; environmental degradation; distributional heterogeneity
• ISSN: 0305-750X; 1873-5991
• DOI: 10.1016/j.worlddev.2014.08.013

•We examine the effects of democracy and financial openness on environmental pollution.•Panel properties and quantile regression techniques are exploited to control for two kinds of heterogeneity.•The effect of democracy on carbon dioxide emissions is higher heterogeneity across conditional distribution of pollution.•The level of financial openness does not influence carbon dioxide emissions.•Our results for the pollution determinants not only support some findings in the literature, but also provide new conclusions.
The determinants of CO2 emissions have attracted many researchers over the past few decades. Most of studies, however, ignore the possibility that effect of independent variables on CO2 emissions could vary throughout the CO2 emission distribution. We address this issue by applying quantile regression methods. We examine whether greater democracy and more financial openness consistently reduce emissions among the most and least emission nations. Our results show that the effect of democracy on CO2 emissions is heterogeneous across quantiles. Among the most emissions nations, greater democracy appears to reduce emissions, but more financial openness does not appear to reduce it.