On the income-nuclear energy-CO2 emissions nexus revisited

This paper seeks to contribute to the debate over the income-nuclear enery-CO2 emissions nexus by taking specific account of the possible endogeneity of income, which has been largely ignored by early studies. A multivariate cointegrated vector autoregression (CVAR) is applied to top six nuclear generating countries. We find that nuclear energy tends to reduce CO2 emission for all countries. It is also found that income has a beneficial effect on the environment only in some countries. Finally, we find that CO2 emissions and income are indeed determined simultaneously, while nuclear energy acts exogenously, indicating that nuclear energy is the driving variable, which significantly influences the long-run movements of CO2 emissions and income, but is not affected by CO2 emissions and income in the model. (C) 2014 Elsevier B.V. All rights reserved.