Analyzing the Asymmetric Effect of Income per Capita, Capital Inflow, and Oil Price on CO2 Emission in IRAN: NARDL Approach

Seyed Kamal Sadeghi () and Haidar Hamid Rashid Aj Aj ()
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Seyed Kamal Sadeghi: Professor of Economics, University of Tabriz
Haidar Hamid Rashid Aj Aj: Phd student in Economics,, University of Tabriz

Quarterly Journal of Applied Theories of Economics, 2025, vol. 11, issue 4, 203-230

Abstract: This study examines the asymmetric effects of per capita income, oil prices, industrial value added, and foreign direct investment on CO2 emissions in Iran through a non-linear distributed lag autoregression model (NARDL) from 1989 to 2023. This study also discusses the pollution safe haven hypothesis and the Kuznets U-shaped curve simultaneously and asymmetrically for Iran. Based on the results of this study, only the per capita income variable has a linear relationship with CO2 emissions, while the other variables have a non-linear relationship. The model results showed that OPEC oil prices have an inverse relationship with pollution emissions only in positive shocks. For the foreign investment variable, only a negative shock positively affects pollution emissions, which indicates that Iran is not a pollution-safe haven for other countries. Also, industrial value added only has a positive effect on positive shocks. On the other hand, per capita income has a negative effect on pollution emissions. Finally, this study's findings showed that the U-shaped Kuznets curve is not true for Iran

Keywords: co2; NARDL; Kuznets curve (search for similar items in EconPapers)
JEL-codes: C22 D63 O40 (search for similar items in EconPapers)
Date: 2025
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