Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2026-08-18
Number: 26-057/III
Author-Name: Cheyenne Amoroso
Author-Workplace-Name: Universidade da A Coruna
Author-Name: Carolina Garcia-Martos
Author-Workplace-Name: Universidad Politecnica de Madrid
Author-Name: Siem Jan Koopman
Author-Workplace-Name: Vrije Universiteit Amsterdam
Title: A Dynamic Nonlinear Panel Decomposition Model for the Global Environmental Kuznets Curve
Abstract: We propose a decomposition of the Environmental Kuznets Curve (EKC) based on a differenceof-sigmoid functions with one for the economic-growth effect and one for the green-economy effect. This nonlinear function replaces the traditional quadratic specification in panel data models. We further extend the framework with unobserved stochastic trends to capture time-varying features such as evolving energy mixes and technological advances. The panel model can be represented in state-space form. We show that parameter estimation can be carried out by nonlinear regression and Kalman filter methods. In our empirical study, we consider a panel of pollution (CO2 emissions) and economic output variables for 15 major economies (G7, Australia and 7 emerging countries), representing approximately 75% of the global economy. We extract the common EKC where its parameters are pooled or partially pooled across all countries. The empirical results show statistically significant evidence of a global relevant EKC.
Classification-JEL: C32, C33, F64
Keywords: 
File-URL: https://papers.tinbergen.nl/26057.pdf
File-Format: application/pdf
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Handle: RePEc:tin:wpaper:20260057