The Study of Relationship between Economic Growth, CO2 Emissions, Energy Consumption and Employment Ratio in Iran

This paper examines the long run and causal relationship issues between economic growth، carbon emissions، energy consumption and employment ratio in Iran using autoregressive distributed lag model. Empirical results for Iran over the period 1971-2007 suggest an evidence of a long-run relationship between the variables at 5% significance level in Iran. The estimated income elasticity of carbon emissions per capita is 0. 40 and the income elasticity of energy consumption per capita is 0. 71. Results for the existence and direction of Granger Causality show the neither carbon emissions per capita nor energy consumption per capita cause real GDP per capita in the short run. In addition EKC hypothesis at causal framework by using a logarithmic model is not valid in Iran case. The overall results indicate that energy consumption and controlling carbon dioxide emission are likely to have no adverse effect on the real output growth of Iran.