The Impact of Oil Prices on CO2 Emissions in China: A Wavelet Coherence Approach

Bilgili F., Muğaloğlu E., Koçak E.

in: Econometrics of Green Energy Handbook, Economic and Technological Development, Springer Nature, ISBN:978-3-030-46846-0, Daniel Balsalobre-Lorente,Muhammad Shahbaz, Editor, Springer Nature, Chur, pp.31-53, 2020

  • Publication Type: Book Chapter / Chapter Research Book
  • Publication Date: 2020
  • Publisher: Springer Nature
  • City: Chur
  • Page Numbers: pp.31-53
  • Editors: Daniel Balsalobre-Lorente,Muhammad Shahbaz, Editor
  • Erciyes University Affiliated: Yes


This paper observes the possible co-movements of oil price and CO2

emissions in China by following wavelet coherence and wavelet partial coherence

analyses to be able to depict the short-run and long-run co-movements at both lowand

high frequencies. To this end, this research might provide the current literature with

the output of potential short-run and long-run structural changes in CO2 emissions

upon a shock (a change) in oil prices in China together with the control variables of

world oil prices, fossil energy consumption and renewable consumption and urban

population in China. Therefore, this research aims at determining wavelet coherencies

between the variables and phase differences to exhibit the leading variable in

potential co-movements. By following the time domain and frequency domain analyses

of this research, one may claim that the oil prices in China have considerable

negative impact on CO2 emissions at high frequencies for the periods 1960–2014

and 1971–2014 in China. Besides, one may underline as well other important output

of the research exploring that the urban population and CO2 emissions have positive

associations, move together for the period 1960–2014 in China. Eventually, this

paper might suggest that authorities follow demand-side management policies considering

energy demand behavior at both shorter cycles and longer cycles to diminish

the CO2 emissions in China.