The effect of corruption on carbon dioxide emissions in APEC countries: A panel quantile regression analysis

The relationship between corruption and CO2 emissions has been receiving increased attention in recent years, but little work has been conducted for the Asia-Pacific Economic Cooperation (APEC) countries even if they have determined to fight against corruption and addres climate change. Using the quantile regression approach, this paper develops a panel data model for the effect of corruption on CO2 emissions in APEC countries. The empirical results show that, first of all, the effect of corruption on CO2 emissions is heterogeneous among APEC countries. Specifically, there is significant negative effect in lower emission countries, but insignificant in higher emission countries. Second, there exists an inverted U-shaped Environmental Kuznets Curve (EKC) between corruption and CO2 emissions, and the per capita GDP at the turning point of the EKC may increase when CO2 emissions increase. Finally, corruption may have not only a negative direct effect on CO2 emissions, but also a positive indirect effect through its effect on per capita GDP. The total effect appears positive, which indicates corruption may worsen environmental quality overall in APEC countries. (C) 2016 Elsevier Inc All rights reserved.