The environmental Kuznets curve: functional form, time-varying heterogeneity and outliers in a panel setting
2013 | journal article. A publication with affiliation to the University of Göttingen.
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Details
- Authors
- Martinez-Zarzoso, Inmaculada ; Maruotti, Antonello
- Abstract
- This paper contributes to extend the Environmental Kuznets Curve (EKC) literature by introducing a new estimation technique able to deal with the issue of slope heterogeneity, functional form issues, the role of unobserved time-dependent factors and the presence of outliers in the data. A robust hidden Markov model is used to estimate an Environmental Kuznets Curve for a sample of 28 Organisation of Economic Co-operation and Development countries over the period 1968 to 2006. Dependent mixture models provide more flexibility than single-distributions do by assuming the existence of a latent process that follows a finite state first-order Markov chain and affects the distribution of the response variable. The main results indicate that the relationship between emissions and income is country-specific and changes over time. By using robust estimation, five homogeneous groups of countries are identified and country-membership transition dynamics are shown. Copyright (c) 2013 John Wiley & Sons, Ltd.
- Issue Date
- 2013
- Status
- published
- Publisher
- Wiley-blackwell
- Journal
- Environmetrics
- ISSN
- 1099-095X; 1180-4009
- Sponsor
- Spanish Ministry of Innovation and Science [ECO2010-15863]