Carbon curse: As you extract, so you will burn

Adrien Desroziers, Yassine Kirat (yassine.kirat@univ-orleans.fr) and Arsham Reisinezhad
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Yassine Kirat: LEO, University of Orleans, France.

No 2023.09, Working Papers from FAERE - French Association of Environmental and Resource Economists

Abstract: The "Carbon Curse" theory suggests that fossil fuel richness leads countries to have more carbon intensive development trajectories than they would otherwise. Using causal inference for cross-country panel data spanning 1950-2018, we globally estimate the effect of giant oil and gas discoveries on carbon emissions. Our findings show that the effect is sizable and persistent. Countries that discovered large fossil-fuel fields emit roughly 30% more pollution post-discovery than countries without these discoveries. This effect is stronger in developing countries, and is substantial from the date of the first giant discovery. By exploiting the randomness of the timing of discoveries, we provide the first plausibly-causal evidence in support of the "Carbon Curse".

Keywords: Carbon Curse; fossil-fuel; giant discoveries; CO2 Emissions; Panel data (search for similar items in EconPapers)
JEL-codes: Q32 Q53 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2023-10
New Economics Papers: this item is included in nep-ene, nep-env and nep-ger
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Persistent link: https://EconPapers.repec.org/RePEc:fae:wpaper:2023.09

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