Testing the Kuznets Curve Hypothesis at the Sector Level: Evidence from PNARDL for OECD Countries

Testing the Kuznets Curve Hypothesis at the Sector Level: Evidence from PNARDL for OECD Countries | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Testing the Kuznets Curve Hypothesis at the Sector Level: Evidence from PNARDL for OECD Countries Mehmet Songur, Erginbay Uğurlu, Yusuf Muratoğlu, Devran Şanlı This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-4016803/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract Since the contribution of economic sectors to GDP is heterogeneous, they also contribute differently to CO2 emissions and environmental degradation. Although many studies investigate the Environmental Kuznets Curve (EKC) hypothesis, there are still gaps in this literature, specifically in sectors. This study contributes to the literature in several ways. First, it examines the validity of the environmental EKC hypothesis for four different sectors (Agriculture, Industry, Manufacture and Service). Second, the impact of energy consumption on CO2 is examined asymmetrically. Finally, annual data from 38 OECD countries from 1990 to 2022 are used to fill this gap. The method used in the study is a new panel nonlinear ARDL to capture the asymmetric effect of energy consumption on CO2. The findings show that the EKC hypothesis is valid for sectors other than the industrial sector and for the overall economy. The turning point of the Kuznets Curve for the total economy is estimated as $29250 GDP per capita. The PNARDL model's error correction term (ec) is negative and significant. However, the magnitude of the term suggests that the system will return to long-term equilibrium after approximately 2.87 years following any shock. It has been determined that agriculture is the sector that causes the most environmental degradation by increasing CO2 emissions. This situation highlights the limited availability of productive capital equipment and renewable sources in the agricultural sector, even in OECD countries. Moreover, the empirical results clearly show that energy consumption has asymmetric effects on emissions in both the long and short run. Positive and negative shocks in energy consumption increase CO2 emissions in OECD economies in the long run. Asymmetric effects are valid for four sectors. Jel Codes: Q42, Q43, Q53 Energy Consumption Environmental Degradation EKC hypothesis Panel NARDL Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-4016803","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":277190602,"identity":"56ebb56a-668e-4f52-8611-4bf7562a1ad0","order_by":0,"name":"Mehmet Songur","email":"","orcid":"","institution":"Dicle University, Diyarbakır","correspondingAuthor":false,"prefix":"","firstName":"Mehmet","middleName":"","lastName":"Songur","suffix":""},{"id":277190603,"identity":"d057bbf7-1d7d-4421-8784-be80d7a4cff7","order_by":1,"name":"Erginbay Uğurlu","email":"","orcid":"","institution":"Istanbul Aydın University, Istanbul","correspondingAuthor":false,"prefix":"","firstName":"Erginbay","middleName":"","lastName":"Uğurlu","suffix":""},{"id":277190604,"identity":"b51f42d8-bd85-4711-98b1-e2d6f9e5cfc0","order_by":2,"name":"Yusuf Muratoğlu","email":"","orcid":"","institution":"Hitit University, Çorum","correspondingAuthor":false,"prefix":"","firstName":"Yusuf","middleName":"","lastName":"Muratoğlu","suffix":""},{"id":277190605,"identity":"2c7709ee-f7dc-4a93-a771-a0941c671484","order_by":3,"name":"Devran Şanlı","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAA40lEQVRIiWNgGAWjYDCCAzAGO2PjAyDFw0e8FmbGZgOQFjYStDCwSYBoglr4jveYffi5o07enJm5rfJrjp0MGwPzw0c38GiRPHPGeGbvmcOGO5sZ227LbksGOozN2DgHjxaDG2nJDLxtBxg3HAZqkdzGDNTCwyaNV8v9Z8mMf9vq7EFaiiW31ROh5QbzYWbeNuZEkBbGj9sOE9YieSb5MLNs2+FkoJZmacZtx3nYmAn4he/4wWbGt211thuOtz/8+HNbtT0/e/PDx/i0oABmHjBJrHIQYPxBiupRMApGwSgYMQAAyttHoxtI4jwAAAAASUVORK5CYII=","orcid":"","institution":"Bartın University, Bartın","correspondingAuthor":true,"prefix":"","firstName":"Devran","middleName":"","lastName":"Şanlı","suffix":""}],"badges":[],"createdAt":"2024-03-05 11:31:38","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-4016803/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-4016803/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":53688603,"identity":"4056cd94-f848-4876-86a8-347a374599d6","added_by":"auto","created_at":"2024-03-29 00:47:07","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":444279,"visible":true,"origin":"","legend":"","description":"","filename":"Manuscriptwithauthordetails07.03.2024.pdf","url":"https://assets-eu.researchsquare.com/files/rs-4016803/v1_covered_384c4600-289b-447e-b42a-856995f6b7c5.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"Testing the Kuznets Curve Hypothesis at the Sector Level: Evidence from PNARDL for OECD Countries","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":false,"hideJournal":true,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Energy Consumption, Environmental Degradation, EKC hypothesis, Panel NARDL","lastPublishedDoi":"10.21203/rs.3.rs-4016803/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-4016803/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eSince the contribution of economic sectors to GDP is heterogeneous, they also contribute differently to CO2 emissions and environmental degradation. Although many studies investigate the Environmental Kuznets Curve (EKC) hypothesis, there are still gaps in this literature, specifically in sectors. This study contributes to the literature in several ways. First, it examines the validity of the environmental EKC hypothesis for four different sectors (Agriculture, Industry, Manufacture and Service). Second, the impact of energy consumption on CO2 is examined asymmetrically. Finally, annual data from 38 OECD countries from 1990 to 2022 are used to fill this gap. The method used in the study is a new panel nonlinear ARDL to capture the asymmetric effect of energy consumption on CO2. The findings show that the EKC hypothesis is valid for sectors other than the industrial sector and for the overall economy. The turning point of the Kuznets Curve for the total economy is estimated as $29250 GDP per capita. The PNARDL model's error correction term (ec) is negative and significant. However, the magnitude of the term suggests that the system will return to long-term equilibrium after approximately 2.87 years following any shock. It has been determined that agriculture is the sector that causes the most environmental degradation by increasing CO2 emissions. This situation highlights the limited availability of productive capital equipment and renewable sources in the agricultural sector, even in OECD countries. Moreover, the empirical results clearly show that energy consumption has asymmetric effects on emissions in both the long and short run. Positive and negative shocks in energy consumption increase CO2 emissions in OECD economies in the long run. Asymmetric effects are valid for four sectors.\u003c/p\u003e\n\u003cp\u003e\u003cstrong\u003eJel Codes: \u003c/strong\u003eQ42, Q43, Q53\u003c/p\u003e","manuscriptTitle":"Testing the Kuznets Curve Hypothesis at the Sector Level: Evidence from PNARDL for OECD Countries","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2024-03-12 11:09:11","doi":"10.21203/rs.3.rs-4016803/v1","editorialEvents":[{"type":"communityComments","content":0}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true}}],"origin":"","ownerIdentity":"588166fd-d08f-4b67-90f6-77ec880dcc59","owner":[],"postedDate":"March 12th, 2024","published":true,"recentEditorialEvents":[],"rejectedJournal":[],"revision":"","amendment":"","status":"posted","subjectAreas":[],"tags":[],"updatedAt":"2024-03-29T00:38:59+00:00","versionOfRecord":[],"versionCreatedAt":"2024-03-12 11:09:11","video":"","vorDoi":"","vorDoiUrl":"","workflowStages":[]},"version":"v1","identity":"rs-4016803","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-4016803","identity":"rs-4016803","version":["v1"]},"buildId":"qtupq5eGEP_6zYnWcrvyt","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}