Environment and Interdisciplinary Development

Investigating Factors Affecting Energy Consumption and Pollution Emission: A Case Study of Iran

Document Type : Original Article

Author

Samaneh Bagheri

Economics Department, Faculty of Economics, Management and Accounting, Yazd University, Yazd, Iran

https://doi.org/10.22034/envj.2024.409623.1303
Abstract
Introduction: Iran is one of the ten countries with the most pollution, so research in this field is necessary. The goal of countries is high economic growth along with the non-emission of pollution. Environmental destruction and climate change are problems of all countries. Some people believe that economic growth leads to the destruction of the environment, and others do not accept this theory. Sustainable development means that today's generation must meet its own needs without compromising the next generation. Today, countries are trying to achieve sustainable development by minimizing environmental destruction in addition to economic growth. To achieve this goal, international treaties have been concluded between the countries of the world. Many environmental protection organizations were established. One of the long debates among economists is energy consumption. On the one hand, due to economic growth and the production of goods, energy consumption is needed, and on the other hand, the pollution caused by the consumption of this energy fuels environmental and non-climate pollution in countries. Because Iran is a country that sells oil and natural gas, it is a country that has a relative advantage in the field of fossil energy. Considering that Iran has a relative advantage in energy consumption, research in this field becomes necessary. Energy consumption can lead to more pollution.
Materials and Methods: This research examines the factors affecting energy consumption and pollution emission in Iran using the Markov switching method, fully adjusted ordinary least squares and dynamic ordinary least squares, and Johansen's method for the period of 1994-2021. In most of the studies conducted on the relationship between energy consumption and major macroeconomic variables, the influence of factors affecting energy consumption, especially factors affecting energy consumption and pollution emission in Iran, has not been paid attention to.
Results: According to the results of this research, the Kuznets curve was confirmed by the dynamic time series method and it means that economic growth leads to pollution in the beginning, but then it causes pollution to decrease. Energy consumption has had a positive and significant effect on carbon dioxide emissions. According to the research results, GDP, energy consumption, foreign direct investment has a positive and significant effect on carbon dioxide emissions. Trade liberalization affects energy consumption from its effect on the environment. The environment can be affected by trade liberalization through the three channels of scale effect, combination effect and technique effect. The scale effect is a change in economic growth, the combination effect is a change in the structure of the economy, and the technique effect is a change in the method and technology used in production. According to the results, trade has a negative and significant effect on carbon dioxide emissions. The LR test showed that the model is nonlinear and the Markov switching method was used to estimate the model.
Discussion: Environmental issues are one of the most important concerns of countries and creating a clean environment is one of the important goals of countries. According to the research results, using the Markov switching MS-ARMA (3,1,0) method, there is a positive and significant relationship between trade, GDP, and energy consumption with a break in energy consumption. Due to the effect of Iran's composition in energy-intensive industries, it has gained a relative advantage and trade has a positive and significant effect on energy consumption.

Keywords

Kuznets Curve
Markov Switching
Energy Consumption
Pollution Emission

Subjects

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Environment and Interdisciplinary Development
Volume 9, Issue 83
Spring 2024
Pages 31-44

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