SEARCHING FOR THE EXISTENCE OF EKC HYPOTHESIS IN TURKEY: AN APPROACH USING ELASTICITIES IN THE PRESENCE OF MULTICOLLINEARITY

Authors : Buket ALKAN, Necip BULUT

Pages : 232-248

Doi:10.17065/huniibf.944180

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Publication Date : 2022-06-28

Article Type : Research Paper

Abstract :This paper searches for the validity of the Environmental Kuznets Curve (EKC) hypothesis for Turkey in the period of 1990–2015. The multicollinearity problem arising from the inclusion of both the GDP itself and its quadratic form together in the model presented by the Kuznets Curve is taken into account in this research. In order to overcome the multicollinearity problem, the validity of the EKC hypothesis has been decided through the interpretation of the long-and short-term elasticity coefficients of the Autoregressive Distributive Lag (ARDL) model. Economic Complexity Index (ECI) and Environmental Policy Stringency (EPS) index, which are rarely used in the literature, have been added to the EKC model as control variables. The validity of the EKC hypothesis for Turkey is not supported by the results of the empirical analysis since the long–term GDP elasticity is not found negative and also greater than the short–term coefficient. On the other hand, while increasing economic complexity has been found to reduce environmental degradation in the long run, sufficient evidence has not been provided for the importance of the Environmental Policy Stringency (EPS) index in the sample period for Turkey.
Keywords : ÇKE hipotezi, ARDL Modeli, Ekonomik Büyüme, Çevresel Bozulma, Karbondioksit Emisyonu, Çoklu Doğrusal Bağıntı