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Analysis Study Research Paper | Economics | Madagascar | Volume 12 Issue 9, September 2023 | Popularity: 5.2 / 10

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Economic Growth, Reduction of CO2 Emissions and Sustainable Development: Case of Madagascar

Tsimangataka Andriamampiandra Tsimiovalaza

Abstract: Madagascar is like all countries struggling to reduce CO2 emissions, degradation, and deforestation. This fight against CO2 emissions has appeared from the year 1970 to the present day. This fight against emissions is essential for reforestation and the protection of the existing forest to avoid environmental degradation according to the objectives of sustainable development within the framework of the Reduction of Emissions from Degradation and Deforestation or REDD. Thus the monetization of these emissions is known from the year 1990. Here the monetization is equivalent to that of net savings adjusted by including the damage caused by particular emissions or as a percentage of gross national income denoted RN, given from of the World Bank. Even if CO2 emissions are monetized or taxed, these emissions keep getting worse. Thus, to properly analyze the correlation between the environment and the economy, we have adopted the simple variance auto regression VAR model. This VAR model is adequate to the methodological response in question, as the a priori constraints of the model are reduced; it also allows knowing the causal effect and innovations through impulse shocks and forecasting errors. According to our results of analysis obtained and simulation, we found that economic growth can be improved from the monetization of CO2 emissions and the environment? Provided that our State respects the practice of environmental law. These results also present the short-term and medium-term relationships between variables, but in the long term the impulse shocks between variables remain stable. The variance forecast errors are corroborated with that of the simulation of the impulse shocks. Thus a one-way causal relationship from CO2 emissions to national income as an indicator of economic growth has been identified in the short and medium term.

Keywords: monetization, development, VAR model, emission, degradation

Edition: Volume 12 Issue 9, September 2023

Pages: 1691 - 1695

DOI: https://www.doi.org/10.21275/SR23831184321

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