34. International Public Finance Conference
An Empirical Analysis on the Relationship Between Renewable Energy Consumption, Health Care Expenditures and Carbon Dioxide Emission in the European Union Countries and TurkeyÇiğdem Börke Tunalı, Naci Tolga Saruç
In the existing literature, although there are many studies which empirically investigate the relationship among energy consumption, economic growth and carbon dioxide emission the number of studies which analyse the causality between health care expenditures and carbon dioxide emission is very low. However, as health care expenditures can affect carbon dioxide emission, the changes in carbon dioxide emission can lead to the significant changes in health care expenditures. The aim of this study is to empirically investigate the causality relationship among renewable energy consumption, health care expenditures and carbon dioxide emission in the European Union countries and Turkey. In the empirical analysis, panel Granger causality test which is developed by Dumitrescu and Hurlin (2012) is calculated by using a dataset covering the period between 2000 and 2014 for 27 European Union countries and Turkey. According to the results of the empirical analysis, it is found that there is not a causality relationship between health care expenditures-carbon dioxide emission and health care expenditures-renewable energy. However, the results show that there is a unidirectional causality between renewable energy and carbon dioxide emission and the direction of this causality is from carbon dioxide emission to renewable energy. The existence of this relationship between carbon dioxide emission and renewable energy indicates that the level of carbon dioxide emission is taken into account in renewable energy investments and the policies that aim to increase the usage of renewable energy. Since the dataset used in the empirical analysis covers a short period of time and this may lead to the non-causality results between health care expenditures-carbon dioxide emission and health care expenditures-renewable energy it is required to do new empirical analyses by using longer datasets in order to assess the relationship between these variables more accurately in the future.