Causality relationship between CO2 emissions, GDP and energy intensity in Tunisia

This article analyzes the causality between the economic growth, the energy and the environment, measured by CO2 emissions. Our empirical study is based on a series of annual data from 1980 to 2010 in Tunisia. Our study was conducted using the Granger causality test and variance decomposition. The empirical results confirm the presence of a positive effect between the energy consumption and the economic growth measured by gross domestic product (GDP). Thus, there is a unidirectional relationship between GDP and CO2 emissions in the short term. This analysis shows, as is common to relatively fast-growing economies in Tunisia, that the biggest contributor to the rise is CO2 emissions. Hence, in congruence with the result of variance decomposition, the GDP affects CO2 emissions in the short and medium term at an almost constant level (10 %). The non-renewable energy intensity in Tunisian economy is responsible for a modest reduction in CO2 emissions, which suggests the implementation of conservation policies aimed at energy efficiency and the orientation toward renewable energy. © 2014, Springer Science+Business Media Dordrecht.