Heterogeneous Influencing Mechanism-based Stochastic Modeling Of Energy Use

This dissertation systematically analyzes the influencing mechanisms among energy use,carbon emissions,and economic growth in relation to different driving and inhibition factors including urbanization,industrialization,construction sector,financial development,and international trade.For this purpose,the linkages and influencing mechanisms among energy,economic growth,and carbon emissions are analyzed in relation to those driving and inhibition factors.In this dissertation,STIRPAT is modified to introduce the construction sector as a factor of technology(T) component.Second,based on modified STIRPAT,five structural equations are set up which allow analyzing the empirical interactions among variables of interest simultaneously.Third,construction sector-augmented environmental Kuznets curve(EKC) hypothesis is proposed and tested.Fourth,a novel method,dynamic common correlated effects mean group(DCCEMG) estimator is employed which permits homogeneity and heterogeneity in panel data.Further,DCCEMG is robust to both endogeneity and cross-sectional dependence.Based on empirical findings,energy consumption,gross regional product(GRP),urbanization,construction sector,and CO2 emissions established a long-run equilibrium relationship.Additionally,both energy consumption growth and construction sector growth exerted significant positive impacts on CO2 emissions labeled as;energy and construction driven emissions push impacts,respectively.Finally,construction sector-augmented EKC hypothesis is found valid.Also,in this dissertation,a production function model introducing financial development as a shift factor of growth,while trade and emissions as determinants of total factor productivity has been developed.Second,based on new augmented growth model,a system of five simultaneous equations has been constructed to simultaneously examine the influence among the variables of interest.Third,EKC is estimated for financial development and international trade variables by introducing their quadratic terms into the model.Fourth,based on newly augmented model,DCCEMG estimator is employed.According to the key empirical findings,financial development exposed dual nature in terms of its influence on energy consumption and carbon emissions.The banking-based financial development is revealed to add in energy consumption and carbon emissions,while stock market-based financial development curtailed energy consumption and mitigated the carbon emissions,improving the environmental quality.Moreover,the existence of conventional EKC as well as international trade and financial development based EKC in all the regions except western economic zone,for which the conventional EKC and international trade based EKC are not confirmed.Additionally,this dissertation extends a growth model based on production fbnction to include industrialization as shift factor and pollutant emissions as determinant of total factor productivity.Second,a system of five simultaneous structural equations has been established to analyse the five-ways causal linkages among the empirically analysed variables.Third,in order to allow for the possibility of panel heterogeneity,second generation Augmented Mean Group(AMG)estimator and Common Correlated Effects Mean Group(CCEMG)estimator are estimated to yield reliable estimates which are robust to cross sectional dependence and cointegration issues.Based on empirical results,the impact of urbanization on economic growth varied from negative to neutral to positive for western economic zone,central economic zone and easterm economic zone,respectively,and is known as 'urbanization ladder effect'.Moreover,moving from western to eastern zone,as regions develop,industry expansion has more powerful impact on economic growth,and thus,it is defined as 'industry expansion effect,.In bidirectional causality between energy consumption and economic growth,the 'feedback effect' of economic growth remained dominant for all the regions.Based on empirical findings,vital and useful policies are implicated.Finally,in this dissertation an empirical attempt has been made explore the dynamic causal linkages among urbanization,energy consumption,pollutant emissions and economic growth,making use of simultaneous structural equations.A unified model of economic growth,incorporating urbanization,energy consumption and pollutant emissions,has been developed which has been estimated employing one-step System generalized method of moments(GMM)as well as one-step Difference GMM estimator.The empirics revealed that(1)urbanization positively drives energy consumption and pollutant emissions but is not driven by the same,(2)energy consumption positively drives pollutant emissions but is not driven by the same,(3)pollutant emissions negatively drives and is driven by economic growth,(4)economic growth positively drives and is driven by urbanization and energy consumption.These results are highly robust across all the panels.Based on these results,the policies proposed include(?)developing incentive/subsidy based urbanization mechanism supportive to induce more migration to western economic zone of China,(?)developing rationing instrument concerning energy prices,setting the differentiated price structure based on urbanization level and type of fossil-fuels used,and(?)directing further urbanization targeting less urbanized regions,like western economic zone,focusing low-emissions infrastructure and transport system to sustain high prospective growth rates.