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The impact of energy consumption and economic growth on carbon dioxide emissions.

Osobajo, Oluyomi A.; Otitoju, Afolabi; Otitoju, Martha Ajibola; Oke, Adekunle


Afolabi Otitoju

Martha Ajibola Otitoju

Adekunle Oke


This study explored the effect of energy consumption and economic growth on CO2 emissions. The relationship between energy consumption, economic growth and CO2 emissions was assessed using regression analysis (the pooled OLS regression and fixed effects methods), Granger causality and panel cointegration tests. Data from 70 countries between 1994–2013 were analysed. The result of the Granger causality tests revealed that the study variables (population, capital stock and economic growth) have a bi-directional causal relationship with CO2 emissions, while energy consumption has a uni-directional relationship. Likewise, the outcome of the cointegration tests established that a long-run relationship exists among the study variables (energy consumption and economic growth) with CO2 emissions. However, the pooled OLS and fixed methods both showed that energy consumption and economic growth have a significant positive impact on CO2 emissions. Hence, this study supports the need for a global transition to a low carbon economy primarily through climate finance, which refers to local, national, or transnational financing, that may be drawn from public, private and alternative sources of financing. This will help foster large-scale investments in clean energy, that are required to significantly reduce CO2 emissions.


OSOBAJO, O.A., OTITOJU, A., OTITOJU, M.A. and OKE, A. 2020. The impact of energy consumption and economic growth on carbon dioxide emissions. Sustainability [online], 12(19), article ID 7965. Available from:

Journal Article Type Article
Acceptance Date Sep 17, 2020
Online Publication Date Sep 25, 2020
Publication Date Oct 1, 2020
Deposit Date Sep 28, 2020
Publicly Available Date Sep 28, 2020
Journal Sustainability
Electronic ISSN 2071-1050
Publisher MDPI
Peer Reviewed Peer Reviewed
Volume 12
Issue 19
Article Number 7965
Keywords Climate change; Climate finance; Economic growth; CO2 emissions; Energy consumption
Public URL


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