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Environmental Kuznets Curve for sulfur: evidence using GMM estimation and random coefficient panel data models

Published online by Cambridge University Press:  17 September 2003

George E. Halkos
Department of Economics, University of Thessaly, Volos, Greece. Email HALKOS@UTH.GR


The purpose of this study is to test empirically the hypothesis of the inverted U-shaped relationship between environmental damage from sulfur emissions and economic growth as expressed by GDP. Using a large database of panel data consisting of 73 OECD and non-OECD countries for 31 years (1960–1990) we apply for the first time random coefficients and Arellano-Bond Generalized Method of Moments (A–B GMM) econometric methods. Our findings indicate that the EKC hypothesis is not rejected in the case of the A–B GMM. On the other hand there is no support for an EKC in the case of using a random coefficients model. Our turning points range from $2805–$6230/c. These results are completely different compared to the results derived using the same database and fixed and random effects models.

Theory and Applications
© 2003 Cambridge University Press

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Thanks are due to two anonymous referees for helpful and constructive comments; to Dr Paul Latreille at the University of Wales Swansea, to Dr David Stern at the Australian National University and to Dr I. Kevork at the University of Thessaly for helpful discussions on an earlier draft. The use of data sources and their interpretation, as well as any remaining errors are solely the author's responsibility.