ISSN: 0973-7510

E-ISSN: 2581-690X

Yifeng Wang
1School of Economics, Xiamen University, Xiamen, Fujian – 361005, China.
J Pure Appl Microbiol. 2015;9(3):1867-1874
© The Author(s). 2015
Received: 09/04/2015 | Accepted: 21/05/2015 | Published: 30/09/2015
Abstract

The relationship between economic growth and carbon emissions has become a hot issue of research. We use the dynamic correlation multivariate stochastic volatility model to study the dynamic relationship between carbon emissions and the economic growth. We firstly exam the co-integration and Granger causality relation. We find that they have a long-term stable relationship and the economic growth is the Granger cause of carbon emissions. We then use DC-MSV model to recover the time-varying correlation coefficient between Chinese GDP. We find that the correlation coefficient is very high and has great time-varying property. Lastly we use the time-varying correlation coefficient to forecast Chinese green economic growth rate and has great forecast power.

Keywords

Multivariate Stochastic Volatility Model, Time-varying Correlation Coefficient, Green Economic Growth Rate

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