Granger Causality Relationship between Co2 Emission, Industrial Value added and Energy Consumption in Iran

Abstract

This study investigates the Granger causality relationship between energy consumption, carbon emission and industrial value added, including labor and gross fixed capital formation in the model. We found that energy consumption is Granger cause of carbon dioxide emission and industrial value added. Also results of variance analysis model suggests that the long term effects of variables on their own swings gradually declines, and share of other variables increases.

Keywords

• carbon dioxide emission
• industrial value added
• energy consumption
• granger causality
• analysis variance