AUTHORS: Ritu Rana, Manoj Sharma

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ABSTRACT: This paper examines the causal linkages of carbon dioxide (CO2) emissions with energy consumption (EC) and investment patterns {both domestic (DI) and foreign (FDI)} in India along with electricity production from three different and main sources i.e. coal (C), renewable (R) and hydroelectric (H) sources in a phased manner. Results indicate unidirectional causalities from CO2, FDI, C and H to EC indicating that CO2 emissions, foreign investments, coal-fuelled electricity and use of hydroelectric sources for power generation all become the causes for energy consumption in India. Unidirectional causality is also found from FDI to CO2 confirming the existence of Pollution Haven Hypothesis (PHH) in India. The unidirectional causality from C to DI and no causality from/to R to/from any other variable indicate that C is the dominant source for electricity production in domestic investments in India as compared to R and H. Electricity production from H is causing FDI in India as evident from the unidirectional causality found from H to FDI.

KEYWORDS: - CO2 emissions, energy consumption, electricity generation, investments in energy, domestic investments, foreign direct investment, causality testing

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WSEAS Transactions on Business and Economics, ISSN / E-ISSN: 1109-9526 / 2224-2899, Volume 16, 2019, Art. #7, pp. 54-59


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