Causality relationship between coal consumption and GDP: Difference of major OECD and non-OECD countries

This paper uses Granger causality tests to examine the differences of causal relationships between coal consumption and GDP in major OECD and non-OECD countries, using data for the period of 1980-2005. What we discovered is that unidirectional causality running from GDP to coal consumption exists in Japan and China, and no causality relationship between coal consumption and GDP in India, South Korea and South Africa while the series are not cointegrated in USA. The major OECD or non-OECD countries especially China, India and South Africa should reduce their CO2 emissions in coal consumption to reach sustainable development. (C) 2007 Elsevier Ltd. All rights reserved.