Table 2 Definition of variables and data sources
Variable | Description | Expected sign | Source |
|---|---|---|---|
CO2 | CO2 emissions (kg per 2010 US$ of GDP) | N/A | WDI |
EC | Energy consumption, million tonnes oil equivalent | Positive | BP Statistical Review of World Energy |
FD | Financial development is proxied using five measures, which include as follows: | Â | Â |
M3GDP | Liquid liabilities; | Positive or negative | WDI |
TDGDP | Total bank deposit; | Positive or negative | WDI |
DCPS | Domestic credit to private sector; | Positive or negative | WDI |
DCFS | Domestic credit provided by financial sector; and | Positive or negative | WDI |
FSD | Financial system deposits | Positive or negative | WDI |
TECH | Technological innovation is measured by gross domestic spending on R&D (% GDP) | negative | WDI |
OPEN | Trade openness is computed as composite trade intensity introduced by Squalli and Wilson (2011) capturing trade effect | Positive or negative | WDI, Authors |
SE | Real GDP per capita capturing scale effect | Positive | WDI |
TE | Real GDP per capita squared capturing technique effect | Negative | WDI, Authors |
FDI | Foreign direct investment, net inflows (% of GDP) | Positive | WDI |
IGDP | Industry, value added (% of GDP) | Positive or negative | WDI |