A Study Regarding the Relationship between Carbon Emissions, Energy Consumption, and Economic Development in the Context of the Energy Growth Nexus

Laurențiu-Stelian Mihai (), Laura Vasilescu, Cătălina Sitnikov, Anca Băndoi, Leonardo-Geo Mănescu and Lucian Mandache
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Laurențiu-Stelian Mihai: Faculty of Economics and Business Administration, University of Craiova, 200585 Craiova, Romania
Laura Vasilescu: Faculty of Economics and Business Administration, University of Craiova, 200585 Craiova, Romania
Cătălina Sitnikov: Faculty of Economics and Business Administration, University of Craiova, 200585 Craiova, Romania
Anca Băndoi: Faculty of Economics and Business Administration, University of Craiova, 200585 Craiova, Romania
Leonardo-Geo Mănescu: Faculty of Electric Engineering, University of Craiova, 200585 Craiova, Romania
Lucian Mandache: Faculty of Electric Engineering, University of Craiova, 200585 Craiova, Romania

Energies, 2024, vol. 17, issue 17, 1-38

Abstract: As the EU strives to achieve its climate goals, it is becoming increasingly crucial to understand the complex relationships between economic activity, energy consumption, and carbon emissions. In this context, our paper aims to investigate the correlation between carbon emissions, energy consumption, and economic development. To fulfill our aim, we have used Eurostat and OECD data for the EU-27 member states for a period of 13 years (2010–2022), using a linear regression as the main analysis method. Our results have shown that there is a strong correlation between demand-based and production-based CO 2 emissions as well as between production-based CO 2 emissions and final energy consumption, while at the same time, our findings have shown that there is no direct correlation between energy consumption and economic development, aligning our study with the neutrality hypothesis of the energy growth nexus. This paper expands the ongoing discussion on sustainable development and climate change mitigation by conducting a thorough analysis of the EU-27 countries over a span of thirteen years. The results emphasize the need for integrated strategies that address both production and consumption emissions, emphasize the vital role of energy efficiency, and raise questions about the effectiveness of increasing energy consumption to enhance economic productivity or CO 2 efficiency.

Keywords: carbon emissions; energy consumption; economic development; energy growth nexus; neutrality hypothesis (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2024
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