Environmental Kuznets Curve (EKC) Hypothesis in Lao PDR: The Role of Globalization and Financial Development
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Abstract
This paper examines the cointegration and causal relationship between economic growth, carbon dioxide emission, population density, and globalization in Lao PDR for the period from 1993-2013. The empirical analysis uses an autoregressive distributed lag (ARDL). The results confirm cointegration between the variables. Our results also confirm the presence of an environmental Kuznets curve (EKC). The findings show that income, energy consumption, and financial development have become important driving factors for the increase in the emission of carbon dioxide while globalization has no significant effect on environmental degradation. The empirical findings enable policy-makers to draw some conclusions about sustainable development in Lao PDR.
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