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Investigating the Carbon Leakage Effect on the Environmental Kuznets Curve Using Luminosity Data

By Arne Steinkraus

Abstract

This paper studies the effect of carbon leakage on the environmental Kuznets curve (EKC) using satellite nighttime light data. I show that nighttime lighting is an important variable for estimating carbon dioxide emissions that is superior to other existing indicators and covers all countries in the world. I find evidence of an inverted-U shaped relationship between light and, thus, greenhouse gas emissions and income, with a turning point at approximately US $50,000. However, the relationship is primarily driven by changes in the structure of international trade, implying strong carbon leakage effects. Consequently, environmental regulations that become operative in only one part of the world may fail without global coordination

Topics: F18, F64, Q50, ddc:330, Carbon Leakage, Environmental Kuznets Curve, Nighttime Lighting
Publisher: Kiel und Hamburg: ZBW - Deutsche Zentralbibliothek f\ufcr Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft
Year: 2016
OAI identifier: oai:econstor.eu:10419/126084
Provided by: EconStor

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