Effects of economic growth, electricity consumption, energy use, and urbanization on carbon dioxide emissions in Vietnam (early view)

Abstract

The aim of this article is to explore the causal relationship between CO₂ emissions, economic growth, electricity consumption, energy use, and urbanization in Vietnam between 1982 and 2016 using the VECM. In the short run, it has been empirically found that GDP, electricity consumption, and energy use have significant and positive relationships with CO₂ emissions in Vietnam. Results also indicate that electricity consumption and energy use are drivers contributing to increase GDP, while CO₂ emissions and urban population negatively affect GDP. We also found that GDP has a significant and negative impact on electricity consumption, but energy use positively affects electricity consumption in Vietnam. Further, urban population has a negative influence on energy use, while energy use has a positive relationship with urban population. In the long run, results demonstrate that GDP per capita and energy use per capita have significant and positive influences on CO₂ emissions in Vietnam, while urban population contributes to reduce CO₂ emissions. Results of the Johansen co-integration test show that there is a long run relationship between CO₂ emissions, economic growth, electricity consumption, energy use, and urbanization. Results imply that economic growth should be considered by the Vietnamese government along with the target in environmental protection and urbanization should be carefully managed to achieve sustainable development in Vietnam.