ORIGINAL RESEARCH
An Empirical Research on the Relationship
Between Renewable Energy Investment
and Low Carbon Growth in China
More details
Hide details
1
Department of Economics and Management, North China Electric Power University, Baoding, Hebei, China
Submission date: 2020-03-31
Final revision date: 2020-05-27
Acceptance date: 2020-05-31
Online publication date: 2020-10-13
Publication date: 2021-01-20
Corresponding author
XingYu Wu
Department of Economics and Management, North China Electric Power University(Baoding), China
Pol. J. Environ. Stud. 2021;30(2):1095-1104
KEYWORDS
TOPICS
ABSTRACT
The aim of this paper is to investigate the relationship between renewable energy investment and
economic growth in China for the period 1990-2018. The unit root test, co-integration test, vector error
correction model, impulse response function analysis, and Granger causality test were employed by
including intermittent variables namely foreign direct investment and carbon dioxide emissions. The
empirical results indicate that there is a bi-directional long term causality between renewable energy
investment and economic growth. This study implies that growing economy in China is propitious for
the development of renewable energy sector which in turn helps to boost economic growth. Additionally,
economic growth and foreign direct investment influence renewable energy investment in the short
term. The outcome of causality test reveals a two-way Granger causal relationship from renewable
energy investment to economic growth, and a one-way Granger causal relationship from foreign direct
investment to renewable energy investment.