The Impact of Renewable Energy on the Environmental Kuznets Curve in Iran

Ali Hussein Ostadzad () and Parisa Bahlouli ()
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Ali Hussein Ostadzad: Ph.D. Student in Economic, Shiraz University
Parisa Bahlouli: Young Researchers and Elite Club, Marand Branch, Islamic Azad University

Quarterly Journal of Applied Theories of Economics, 2015, vol. 2, issue 2, 127-154

Abstract: Economic growth is the main purpose of economic policies. However, when economic growth is rapid we have serious environmental harm. Hence, a potential contrast between the economic policies and environmental state is stated in the Environmental Kuznets Curve.The main purpose of this study was to estimate the static and dynamic environmental Kuznets curve for the Iranian economy with assuming renewable and fossil energy simultaneously in the model. On the other hand, in this study we considered non-linear pollution function. In order to estimate the parameters related to this function should be used nonlinear methods. In this study, environmental Kuznets curve is estimated using genetic algorithms, (accurate method for numerical optimization). Comparison of the model predictions shows that the power of LAD in prediction is better than the least squared errors (LS). Also the dynamic model is powerful than static model. The results further indicate that the Iranian economy is located on the upward of environmental Kuznets curve. The other hand 12% of the total energy must be used by renewable energy, in order to Iranian economy perch at the critical point of environmental Kuznets curve.

Keywords: Pollution; Fossil Energy; Renewable Energy; Environmental Kuznets Curve; Least Absolute Deviation Error. (search for similar items in EconPapers)
JEL-codes: Q29 Q42 Q43 (search for similar items in EconPapers)
Date: 2015
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