Economic Growth, Energy and Environment: The Analysis of E3 Model in Iran

In the recent decades both financial crises and the environmental changes especially global warming have been of the major issues of the current world. Plenty of studies have concentrated on this issue and thus, various models, including E3 ones, have been suggested to examine the relationship between economy, environment and energy. In this paper, we have analyzed the E3 models using Generalized Method of Moments (GMM) for the period of 1974-2013. The results show that the energy consumption and environmental pollution have positive and significant impact on economic growth. Furthermore, the impact of economic growth on energy consumption is positive and significant. Finally, energy consumption and economic growth have positive and significant effect on the environmental pollution in Iran.