Energy Consumption, CO2 Emissions and Economic Growth Nexus in Oman: Evidence from ARDL Approach to Cointegration and Causality Analysis

The paper examines the nexus between economic growth, energy consumption and carbon
dioxide emission (CO2) in Oman from 1980 to 2018. The study uses ARDL bounds,
Johansen Cointegration and the Granger-causality tests. The bound test as well as the
Johansen Cointegration test both reveals an existence of long-run relationship between CO2
emissions and its determinants. This long relationship indicates that CO2 in Oman is
positively influenced by economic growth and energy consumption.
The analysis also suggested that in the short run; approximately 15.1 per cent of total
disequilibrium in CO2 emissions has being corrected each year. Moreover, Granger
causality analysis indicated that there is a unidirectional causality running from each of the
energy consumption (EC) and GDP per capita (economic growth) CO2 emissions.
Based on the results obtained, the policy makers can formulate strict environmental and
energy policies for the sake of reducing CO2 emissions.