Carbon dioxide emissions and governance: A nonparametric analysis for the G-20

Abstract

This paper applies nonparametric estimators to examine the carbon dioxide emissions–governance relationship. By using data for the twenty largest economies (Group of twenty, G-20) the dynamics of the considered relationship are analyzed for the time period 1996–2010. Six governance measures are included in our analysis (Voice and Accountability, Political Stability and Absence of Violence, Government Effectiveness, Regulatory Quality, Rule of Law and Control of Corruption) as have been defined by the World Bank. The empirical findings reveal a high nonlinear relationship between countries' carbon dioxide emissions and the examined governance measures. The results reveal significant differences on the number of governance measures influencing countries' carbon dioxide emission levels. It is evident that these differences are subject to countries' specific regional and development variations. Finally, it appears that increasing the quality of countries' different governance factors does not always result to lower carbon dioxide emission levels.