Nexus between CO2 emissions, economic growth, and energy consumption with special reference to BRICS: A panel data approach

The BRICS nations are now undergoing rapid economic growth, which has led to apprehensions over the increase in CO2 emissions and energy consumption. The research tries to identify heterogeneity in carbon dioxide emissions, energy use, and GDP growth paths among BRICS nations and further explores using a technique of cointegration between the long-run relationship of these variables. The study employs secondary data obtained from World Development Indicators and panel data analysis to examine the interplay of the variables over the period 2009–2022. The analysis utilizes some of the following variables, that is, CO2 emissions per capita in metric tons, GDP per capita, and energy consumption per capita in oil equivalent. The techniques that will be utilized include those associated with the literature review (text analytics techniques) and other panel data models used for the data analysis, such as Pooled Ordinary Least Squares (OLS), Breusch-Pagan Lagrange Multiplier (BP) test, Random Effects Model (REM), Fixed Effects Model (FEM), and Hausman test. The study also applies the first-generation and second-generation panel unit root tests to determine data stationarity, cross-sectional dependency, serial correlation, heteroscedasticity, Pedroni cointegration tests, and the Dumitrescu-Hurlin Granger causality test to check causality. The findings are that there is no heterogeneity in the dispersion of CO2 emissions, energy consumption, and GDP growth across the BRICS countries. The cointegration tests further reveal the long-run relationship between these variables. This study finally looks for interlinkages between CO2 emissions, economic growth, and energy consumption for BRICS countries. Using an approach with panel data analysis, it contributes to ongoing policy debates on sustainable development and offers guidelines to policymakers in terms of reaching an expedient balance between economic growth and the preservation of the environment.