Conditions of the Occurrence of the Environmental Kuznets Curve in Agricultural Production of Central and Eastern European Countries

Abstract

The article examines the relationship between CO2 equivalent emissions and agricultural production, taking into account additional economic and social variables that correct the considered relationship for the six Central and Eastern European countries over the period 1992–2017. The aim of the article was to confirm or negate the occurrence of the environmental Kuznets curve (EKC) in the countries of Central and Eastern Europe. Countries that experienced a political transformation and were subsequently admitted to the European Union (EU) undergoing a preparatory period were included. The topic is timely as all EU countries are required to monitor their emissions under the EU Climate Monitoring Mechanism. The discussed problem is significant due to the changes taking place in the common agricultural policy, the choice of actions to be taken by individual countries in their national policies, and the choice of instruments to support the transformation of agriculture. Agriculture has a particularly large impact on emissions, especially N2O and CH4. This paper uses GLS (Generalized least squares) panel regression with random effects taking into consideration individual effects for countries. The conducted empirical research confirmed the hypothesis regarding the occurrence of the Kuznets curve in relation to agricultural production. In this situation, it is required to increase the activities of maintaining production growth, with the support of technological changes that significantly increase pro-environmental conditions, because, in the current circumstances, this growth takes place with an increase in CO2 gas emissions, thus leading to negative external effects.

Keywords

• CO₂ emission
• economic determinants
• public goods
• EKC hypothesis
• panel data analysis
• countries of Central and Eastern Europe