CO2 emissions in Latin America: a time series perspective based on fractional integration.

Abstract

This article deals with the analysis of CO2 emissions in Latin America by using a long memory process based on fractional integration. Using data of CO2 emission and CO2 emissions per capita, for 32 Latin American and Caribbean countries, the results show signifcant diferences according to the variable examined, the model used, and the country under examination. In particular, for the CO2 emissions, mean reversion is found in Belize and also under some circumstances in Antigua and Barbuda, Colombia, Dominica, Dominican Republic, Ecuador, Grenada, Honduras, Nicaragua, Panama, Peru, and Uruguay. Thus, shocks in these series have a transitory efect. With respect to the time trends, only for some Caribbean countries, namely, Antigua and Barbuda, Aruba, Bahamas, Cuba, and Jamaica, the trend is insignifcant; on the other hand, large countries like Brazil, Mexico, and Argentina display the highest time trend coefcients; for the CO2 emissions per capita, there are eleven countries where mean reversion is detected, and there are ten that share a lack of signifcance for the trend. The most signifcant trends now take place in Trinidad and Tobago, British Virgin Islands, Barbados, and Guyana. Policy implications of the results obtained are reported at the end of the paper.