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This study examined the empirical effects of electricity consumption on carbon dioxide (CO2) emissions in Iran. To achieve this goal, we applied the autoregressive distributed lag (ARDL) approach. The results indicate that cointegration exists among electricity consumption, economic growth, foreign direct investment (FDI), financial development and carbon dioxide (CO2) emissions. Also findings indicate that increase in electricity consumption has had a direct impact on carbon dioxide (CO2) emissions in both the short and long run. However, financial development and foreign direct investment (FDI) have a negative and significant effect on carbon dioxide (CO2) emissions. Therefore, it is proposed to reduce energy subsidies in the polluting industry. In addition, more investment in the use of renewable energy is required.
Technology and Economics of Smart Grids and Sustainable Energy – Springer Journals
Published: Apr 11, 2022
Keywords: CO2 emissions; Electricity consumption; Foreign direct investment; Financial development
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