Abstract:
There exists a huge international literature on the, so-called, Environmental
Kuznets Curve (EKC) hypothesis, which in turn, postulates an inverted
u-shaped relationship between environmental pollutants and output. The
empirical literature on EKC has mainly used test for cointegration, based on
polynomial relationships between pollution and income. Motivated by the
fact that, measured in per capita CO2 equivalent emissions, South Africa
is the world’s most carbon-intensive non-oil-producing developing country,
this paper aims to test the validity of the EKC for South Africa. For this
purpose, we use a century of data (1911-2010), to capture the process of development
better compared to short sample-based research; and the concept
of co-summability, which is designed to analyze non-linear long-run relations
among persistent processes. Our results, however, provide no support of the
EKC for South Africa, implying that to reduce emissions without sacrificing
growth, policies should be aimed at promoting energy efficiency.
