Coal consumption, urbanization, and trade openness linkage in Indonesia

Robi Kurniawan, Shunsuke Managi

Research output: Contribution to journalArticle

9 Citations (Scopus)

Abstract

This paper explores the effects of economic growth, urbanization, industry, and trade openness on coal consumption in Indonesia over the period 1970–2015. To closely adhere to the Environmental Kuznets curve narratives, we consider coal consumption which has been scarcely explored in the EKC debate, as a proxy of environmental pressure. We estimate the autoregressive distributed lag (ARDL) method and confirm that the variables are cointegrated for long run linkage with the presence of structural breaks. The empirical evidence showed that economic growth, urbanization and trade openness increase coal consumption while decreasing share of secondary industry reduce it. We also verify the existence of environmental Kuznets curve. Having a vital role in the energy mix, Indonesia needs to restrain excessive coal consumption to enhance environmental quality. Our results also imply urbanization and trade openness are crucial factors on coal consumption. Consequently, it should be taken into consideration in energy policy-making process, such as energy conservation policies in the residential sector and prioritize foreign investment which brings cutting-edge coal technologies.

Original languageEnglish
Pages (from-to)576-583
Number of pages8
JournalEnergy Policy
Volume121
DOIs
Publication statusPublished - Oct 2018

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urbanization
Coal
coal
Kuznets curve
economic growth
industry
energy conservation
energy policy
Economics
policy making
environmental quality
Energy policy
trade openness
consumption
Industry
Energy conservation
energy

All Science Journal Classification (ASJC) codes

  • Energy(all)
  • Management, Monitoring, Policy and Law

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Coal consumption, urbanization, and trade openness linkage in Indonesia. / Kurniawan, Robi; Managi, Shunsuke.

In: Energy Policy, Vol. 121, 10.2018, p. 576-583.

Research output: Contribution to journalArticle

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