Environmental Kuznets Curve for sulfur: evidence using GMM estimation and random coefficient panel data models

Abstract

The purpose of this study is to test empirically the hypothesis of the inverted U-shaped relationship between environmental damage from sulfur emissions and economic growth as expressed by GDP. Using a large database of panel data consisting of 73 OECD and non-OECD countries for 31 years (1960-1990) we apply for the first time random coefficients and Arellano-Bond Generalized Method of Moments (A-B GMM) econometric methods. Our findings indicate that the EKC hypothesis is not rejected in the case of the A-B GMM. On the other hand there is no support for an EKC in the case of using a random coefficients model. Our turning points range from $2805-$6230/c. These results are completely different compared to the results derived using the same database and fixed and random effects models.