 Examining the non-linear effects of monetary policy on carbon emissionsJunwei Wu, Cunyi Yang and Li Chen Energy Economics, 2024, vol. 131, issue C Abstract: We ask whether monetary policy plays a role in a nation’s carbon emission and how the effects vary across countries. Using a country panel covering annual data from 2000-2019 and applying the PSTR approach, the present paper finds that: (1) there is a nonlinear and positive association between money supply level and carbon emission; (2) the effect of monetary policy on carbon emission is weaker for countries with higher human development levels or moderate manufacturing shares of GDP, indicating that these countries are more environmentally efficient in implementing monetary policy; (3) countries with heavy manufacturing shares and/or low human development level should be cautious when carrying out economic stimulating, since such stimulating comes at higher costs of the environment. The analysis in the paper can serve as a gauge for environment-concerned central bankers when making monetary decisions and designing green monetary policy. Keywords: Carbon emission; Money supply; COP26; PSTR (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:131:y:2024:i:c:s0140988323007041 DOI: 10.1016/j.eneco.2023.107206 Access Statistics for this article Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant More articles in Energy Economics from Elsevier |
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