Exploring the Relationship between Economic Growth, Trade Openness, CO2 Emissions, and Renewable Energy: Evidence from Eastern European Countries

Abstract

. The objective of this paper is to investigate the relationship between economic growth, CO 2 emissions, trade openness index, as well as the renewable energy consumption in Eastern European countries. The panel ARDL approach is used to reveal the long-and short-run impact of the selected variables on GDP per capita. Stationarity tests reveal that variables are I(0) and I(1), panel cointegration test confirm the long-run equilibrium between the variables, which enables us the use of panel ARDL methodology. The model reveals that in the long run there is a significant relationship between the dependent variable and all the exogenous ones for the selected countries. The Dumitrescu Hurlin causality test confirms the feedback causality between economic growth and trade openness, renewable energy consumption, and economic growth and unilateral causality running from CO 2 emissions to economic growth.