The Relationship between CO2 Emission and Economic Growth: Panel Data Analysis for India, China, Brazil and South Africa

In this study, the relationship between CO2 emission and economic growth is investigated in India, China, Brazil and South Africa countries for the period 1980-2010, using panel cointegration test and panel causality analysis. The results indicate that in these countries the increase of GDP by 1% raises CO2 emission almost by 0.55%. Furthermore, according to countries individual results it is observed that CO2 emission is increasing with economic growth in these countries. For instance, in Brazil, in China, in India and in South Africa, increasing in economic growth by 1% raises CO2 emission respectively by 1%, 0.5%, 0.9%, 0.6%. With regard to panel causality test in both short run and long run there is unidirectional causality running from economic growth to CO2 emission. These countries should give place to more clean energy resources in their energy policy.