Environmental Implications of Increased US Oil Production and Liberal Growth Agenda in Post -Paris Agreement Era

Muhammad Shahbaz, Akassi Kablan, Shawkat Hammoudeh, Muhammad Ali Nasir and Andreas Kontoleon

MPRA Paper from University Library of Munich, Germany

Abstract: Contextualising on the internationally low oil prices era and historically high oil production in USA and refusal to honour the commitments under Paris Agreement (COP: 21), this study investigates the role of education, oil prices and natural resources on CO2 emissions and energy demand in the USA for the period of 1976-2016. In so doing, we employed a bounds testing approach to cointegration which also accounts for the structural breaks. Key findings suggest the presence of a long-run association between underlying variables. The abundance of natural resources and economic growth of the US economy seem to weigh on environmental quality by increasing energy consumption and carbon emissions. Oil prices show a negative association with energy consumption as well as carbon emissions suggesting that a low oil price regime can lead to an increase in carbon emissions and energy consumption. Interestingly, education seems to play an important role by reducing energy consumption and carbon emissions, resultantly improving the US environmental quality. Our findings have profound environmental implications in terms of efforts to tackle climate change and meeting the Paris agreement (COP: 21) ambitions with reality and USA policy stance.

Keywords: Natural Resources; Oil Prices; Education; Energy and Emissions; COP: 21 (search for similar items in EconPapers)
JEL-codes: Q5 (search for similar items in EconPapers)
Date: 2020-01-03, Revised 2020-03-19
New Economics Papers: this item is included in nep-ene and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

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